Question

A banker has $1000 to invest. She deposits part of it in a stock paying 4%, and the rest in bonds that offer 5% return. If the total interest earned in one year was $440, how much was invested at each rate?

Answer 1

Explanation:

Let x represent the amount invested at 4% and y the amount at 5%. Then x + y = 1000.

Then:

0.04(1000 - x) + 0.05x) = 440 (total interest)

Then:

40 - 0.04x + 0.05x = 440, or

0.01x = 400, or

x = 40000 (not possible, because the principal is only $1000.

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Answer 2

Explanation:

Given that:

4x + 5x = $440

9x = $440

x = $49 (Approx.)

So, she received :

from the stock = 4 x 49 = $196

from the bond = 5 x 49 = $245

SO, now, how much did she invest ?