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Question 1128751: An amount of money invested for 1 year in a savings account will earn $1,000. That same amount of money invested in a mini-mall development will earn $6,000 interest in a year, because the interest paid is 10% more than that paid by the savings account. Find the rate of interest paid by each investment.
Answer by greenestamps(13200)   (Show Source):
You can put this solution on YOUR website!
The second interest amount is 6 times the first, so the second interest rate must be 6 times the first. The second interest rate is 10% more than the first; so
let x be the lower interest rate (as a percent)
then 6x is the higher interest rate
6x-x = 10
5x = 10
x = 2
The interest rates are x=2% and 6x = 12%.
It should be noted that the problem, exactly as stated, can't be solved, because the given information is inconsistent.
The problem states that "the INTEREST PAID" is 10% more for the investment in the mini-mall development. But the INTEREST PAID from the mini-mall investment is 6 TIMES the INTEREST PAID by the savings account. 6000 is not 10% more than 1000; it is 500% more.
Although the meaning of the problem is clear, the correct wording should say the interest RATE paid by the mini-mall investment is 10% higher than the RATE paid by the savings account.
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