SOLUTION: Tony has a total of $12,500 in two accounts. One account pays 2% simple interest per year and the other pays 5% simple interest. If he earned $370 in interest in the first year, ho

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Question 903225: Tony has a total of $12,500 in two accounts. One account pays 2% simple interest per year and the other pays 5% simple interest. If he earned $370 in interest in the first year, how much did he invest in each account?
Answer by richwmiller(17219) About Me  (Show Source):
You can put this solution on YOUR website!
We know the total amount of money invested. $12500
x+y=12500,
We know that the total interest for the year for the two accounts is $370
0.02*x+0.05*y=370
x=12500-y
We substitute for x
0.02*(12500-y)+0.05*y=370
We multiply out
250-0.02y+0.05*y=370
We combine like terms.
0.03*y=120
Isolate y
y=4000 at 5%
x=12500-y
Calculate x
x=8500 at 2%
We check
0.02*8500+0.05*4000=370
170+200=370
370=370
Since this statement is TRUE and neither amount is negative then it is ok