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eimsori [14]
4 years ago
7

Seth is planning to invest $20,000 of his money. He is investing it in two banks. Seth invested 7,000 in Bank A, which gives an

interest rate of 4%. If Seth wants to accumulate $1,280 in interest after one year, what rate must bank B offer for Seth to accomplish this yield
Mathematics
1 answer:
Maru [420]4 years ago
7 0
In bank A, after one year this would be the amount in the bank: 

<span>$7,000 x 1.04 = $7280. </span>

<span>He has gained %280 interest. This means you'd need $1000 interest from bank B. </span>
<span>$13,000 would go into bank B... </span>
<span>If Seth's interest rate was 8.69% you could calculate the interest as: </span>

<span>(13000 x 1.0869) - 13,000 = $1129.70 which is a little much (but who'd complain). </span>

<span>This means the interest is lower than this, if it was 7.69% you could just substitute it into the same equation to find that he would get $999.70 interest. This isn't exactly $1000 but it is the most accurate answer to the nearest $100 :) He would then get $1279.70 interest altogether.. just 30 cents short</span>
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