Question

Mary has $65,000 to invest into two accounts. The first account is a private savings offering 6% annual interest and the second account is a government savings account offering 4% annual interest. How much money should Mary invest in each account to make $3,520 in total interest.

Answer 1

Explanation:

Formula for calculating interest is expressed as;

I = PRT/100

P is principal

R is the rate

T is the time

For first account

I = P(1)(6)/100

I1 = 0.06P1

For the second bank!

I2 =>P2(1)(4)/100

I2 = 0.04P2

If the total interest is $3520, then

I1+I2 = 3520

0.06P1+0.04P2 = 3520.... 1

If the Amount invested = $65000

P1+P2 =65000..... 2

Solve. 1 and 2 simultaneously

Eqn 2 × 0.06

0.06P1+0.06P2 = 3900.... 3

Subtract 1 from 3;

0.04P2-0.06P2 = 3520-3900

-0.02P2 = -380

P2 = 380/0.02

P2 = $19000

Get p1;

P1 = 65000-P2

P1 = 65000-19000

P1 = $46000

Hence $46000 was invested in the first account and $19000 in the second