SOLUTION: David split his $25,000 inheritance between Fidelity Short-Term Bond Fund with an annual yield of 5% and T. Rowe Price Tax-Free Short-Intermediate Fund with an annual yield of 4

Question 180831: David split his $25,000 inheritance
between Fidelity Short-Term Bond Fund with an annual
yield of 5% and T. Rowe Price Tax-Free Short-Intermediate
Fund with an annual yield of 4%. If his total income for 1 year on the two investments was $1140, then how much
did he invest in each fund?
Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
David split his $25,000 inheritance
between Fidelity Short-Term Bond Fund with an annual
yield of 5% and T. Rowe Price Tax-Free Short-Intermediate
Fund with an annual yield of 4%. If his total income for 1 year on the two investments was $1140, then how much
did he invest in each fund?
---------------------------------------
Equation:
interest + interest = interest
0.04x + 0.05(25000-x) = 1140
Multiply thru by 100 to get:
4x + 5*25000 - 5x = 114000
x = 125000 - 114000
x = $11000 (amt invested at 4%)
25000-x = $14 (amt invested by 5%)
---------------------------------------
Cheers,
Stan H.
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