SOLUTION: Betsy, a recent retiree, requires $6000 per year in extra income. She has $50000 to invest and can invest in B-rated bonds paying 15% per year or in a certificate of deposit payin
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Question 803692: Betsy, a recent retiree, requires $6000 per year in extra income. She has $50000 to invest and can invest in B-rated bonds paying 15% per year or in a certificate of deposit paying 7% per year. How much money should be invested in each to realize exactly $6000 in interest per year? Answer by mananth(16946) (Show Source):
You can put this solution on YOUR website! Part I 15.00% per annum ------------- Amount invested =x
Part II 7.00% per annum ------------ Amount invested = y
50000
Interest----- 6000.00
Part I 15.00% per annum ---x
Part II 7.00% per annum ---y
Total investment
x + 1 y= 50000 -------------1
Interest on both investments
15.00% x + 7.00% y= 6000
Multiply by 100
15 x + 7 y= 600000.00 --------2
Multiply (1) by -15
we get
-15 x -15 y= -750000.00
Add this to (2)
0 x -8 y= -150000
divide by -8
y = 18750 - x)
Part I 15.00% $ 31250
Part II 7.00% $ 18750
