Question

Lydia has half of her investments in stock paying an 11% dividend and the other half in a stock paying 14% interest. If her total annual interest is $440, how much does she have invested?
Answer

Answer 1

The amount that Lydia has earned on her investment is $198 on the stock paying the 11% dividend and $252 on the stock paying 14% interest for a total earned of $450 on her $3600 investment.

Calculations and Parameters

Let x represent half of her total investment.

The total annual interest earned is $450.

This is represented by the following equation:

0.11x + 0.14x= 450

Collect the like terms together

0.25x = 450

x= 1800

Therefore, half of her total investment is $1800 so her total investment is $3600.

Check the solution:

0.11∗1800 + 0.14 ∗ 1800 = 450

198 + 252 = 450

Therefore, she earned $198 on the stock paying the 11% dividend, and $252 on the stock paying 14% interest for a total earned of $450 on her $3600 investment.

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