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Vern sold his 1964 Ford Mustang for $55,000 and wants to invest the money to earn him 6.4% interest
per year. He will put some of the money into Fund A that earns 4% per year and the rest in Fund B
that earns 10% per year. How much should he invest into each fund (in dollars) if he wants to earn
6.4% interest per year on the total amount?
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He invests $55000 partly at 10% and partly at 4%.
Let x dollars be the amount invested at 10%;
then the amount invested at 4% is (55000-x) dollars.
The total annual interest equation is
0.1x + 0.04*(55000-x) = 0.064*55000.
From this equation
x = = 22000.
ANSWER. $22000 shoud be invested at 10%, and the rest 55000-22000 = 33000 dolars invested at 4%.
CHECK. 0.1*22000 + 0.04*33000 = 3520, the same as 0.064*55000 = 3520. ! correct !
Solved.
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It is a standard and typical problem on investments.
If you need more details, or if you want to see other similar problems solved by different methods, look into the lesson
- Using systems of equations to solve problems on investment
in this site.
You will find there different approaches (using one equation or a system of two equations in two unknowns), as well as
different methods of solution to the equations (Substitution, Elimination).
Also, you have this free of charge online textbook in ALGEBRA-I in this site
- ALGEBRA-I - YOUR ONLINE TEXTBOOK.
The referred lesson is the part of this online textbook under the topic "Systems of two linear equations in two unknowns".
Save the link to this online textbook together with its description
Free of charge online textbook in ALGEBRA-I
https://www.algebra.com/algebra/homework/quadratic/lessons/ALGEBRA-I-YOUR-ONLINE-TEXTBOOK.lesson
to your archive and use it when it is needed.