Question

You invested a total of $60,000 in 2 funds earning 8.5% and 10% simple interest. During 1 year, the 2 funds earned a total of $5400 in interest. How much did you invest in each fund? amount at 8.5% $ amount at 10% $

Answer 1

The amount invested in the fund earning 8.5% is $40,000 whereas $20,000 was invested in the fund earning 10%

What is the return on each fund?

The return on each fund is determined as the amount invested multiplied by the interest rate on the fund

;Let X be the amount invested at 8.5%

Interest=8.5%*X=0.085X

The interest of the fund  invested at 10%=($60,000-X)*10%

The interest of the fund  invested at 10%=$6000-0.10X

Total interest=0.085X+6000-0.10X

Total interest earned during year 1=$5,400

5400=0.085X+6000-0.10X

5400=6000-0.015X

0.015X=6000-5400

0.015X=600

X=600/0.015

X=$40,000(amount invested at 8.5%)

amount invested at 10%=$60,000-$40,000

amount invested at 10%=$20,000

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