document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=693853>Question 693853</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Charlie earns $4,900 in simple interest on a sum of <BR>\n" );
document.write( "money invested for 5 years at a 7% interest rate. How<BR>\n" );
document.write( "much simple interest would he have earned if he had invested<BR>\n" );
document.write( "the same sum of money for 6 years at a 6% interest rate?\r<BR>\n" );
document.write( "<BR>\n" );
document.write( "\n" );
document.write( "A. $3,600<BR>\n" );
document.write( "B. $4,900<BR>\n" );
document.write( "C.$5,040<BR>\n" );
document.write( "D. $5,880\r<BR>\n" );
document.write( "<BR>\n" );
document.write( "<BR>\n" );
document.write( "\n" );
document.write( "*I multiplied the 6% rate times the 6 years and then multiplied the money, then add the interest with the 4900, and got $6,664. Where did I go wrong?  </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #427600 by </B><A HREF=/tutors/aboutme.mpl?userid=KMST><B>KMST(5328)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=KMST><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=KMST><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=427600\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> You probably misread the problem. What the problem asks is how much Charlie would have earned if He had invested in a different way. Charlie chose to invest a certain (unknown to us) sum of money he originally had for 5 years at a 7% interest rate. He earned $4,900 from that. What the problem asks is how much Charlie would have earned if he instead had invested that same unknown sum of money for 6 years at a 6% interest rate.<BR>\n" );
document.write( " <BR>\n" );
document.write( "You could find the sum of money Charlie had originally invested to get the $4,900 in interest. <BR>\n" );
document.write( "Then, you could figure out how much interest he could get from that if he had invested it differently.<BR>\n" );
document.write( "$<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x ALIGN=MIDDLE  ALT=\"x\"   DISABLED_style= \"max-width:90%; height:auto;\" > = amount Charlie had invested originally<BR>\n" );
document.write( "$<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=5%2A0.07%2Ax ALIGN=MIDDLE  ALT=\"5%2A0.07%2Ax\"   DISABLED_style= \"max-width:90%; height:auto;\" > = interets earned by investing $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x ALIGN=MIDDLE  ALT=\"x\"   DISABLED_style= \"max-width:90%; height:auto;\" > for 5 years at 7%<BR>\n" );
document.write( "We know that <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=5%2A0.07%2Ax=4900 ALIGN=MIDDLE  ALT=\"5%2A0.07%2Ax=4900\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=5%2A0.07%2Ax=4900 ALIGN=MIDDLE  ALT=\"5%2A0.07%2Ax=4900\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=0.35x=4900 ALIGN=MIDDLE  ALT=\"0.35x=4900\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=0.35x%2F0.35=4900%2F0.35 ALIGN=MIDDLE  ALT=\"0.35x%2F0.35=4900%2F0.35\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x=14000 ALIGN=MIDDLE  ALT=\"x=14000\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "Investing that amount at 6% for 6 years, Charlie would have earned<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=6%2A0.06%2A14000=highlight%285040%29 ALIGN=MIDDLE  ALT=\"6%2A0.06%2A14000=highlight%285040%29\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( " <BR>\n" );
document.write( "YOUR MISTAKE:<BR>\n" );
document.write( "By multiplying the 6% rate times the 6 years times $4,900,<BR>\n" );
document.write( "you were multiplying the 6% rate times the 6 years times the $4,900 interest Charlie had already earned. That would give you what Charlie could earn in the next 6 years by investing just the $4,900 interest he had already earned at a 6% interest rate. You added that to the $4,900 Charlie had already earned to find what Charlie could get in 13 years if he reinvests only the interest after the first 5 years.<BR>\n" );
document.write( " <BR>\n" );
document.write( "FUN:<BR>\n" );
document.write( "Unfortunately for Charlie, interests rates are very low nowadays.<BR>\n" );
document.write( "However, if Charlie could reinvest his original $14,000 plus the $4,900 interest for one more year at 0.75% he could make another $141.75, which added to the prior $4,900 earning would bring his total earnings up to $5041.75 earned over the course 6 years. </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );