SOLUTION: Joe wants to invest $10,000 in two different types of stocks: Computer and agriculture. If he earns 8% interest on the computer stock and 11.25% interest on the agriculture stock,

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Question 914010: Joe wants to invest $10,000 in two different types of stocks: Computer and agriculture. If he earns 8% interest on the computer stock and 11.25% interest on the agriculture stock, how much should he invest in each if he wants a 10% rate of return on his investment?
Answer by richwmiller(17219) About Me  (Show Source):
You can put this solution on YOUR website!
0.1*10000=$1000 interest earned on $10000 at 10%
Total amount of money invested: $10000
x+y=10000,
Total yearly interest for the two accounts is: $1000
0.08*x+0.1125*y=1000
x=10000-y
Substitute for x
0.08*(10000-y)+0.1125*y=1000
Multiply out
800-0.08*y+0.1125*y=1000
Combine like terms.
0.0325*y=200
Isolate y
y=$ 6153.85 at 11.25% earns $692.307692 interest
x=10000-y
Calculate x
x=$ 3846.15 at 8% earns $307.692308 interest
Check
0.08*3846.15385+0.1125*6153.84615=1000
307.692308+692.307692=1000
1000.0=1000
If 1000.0=1000 is TRUE and neither x nor y is negative then all is well
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