Question

Chelsea took out three loans for a total of ​$ 78 comma 000 78,000 to start an organic orchard. Her​ business-equipment loan was at an interest rate of​ 11%, the​ small-business loan was at an interest rate of 5 5​%, and her​ home-equity loan was at an interest rate of 4.5 4.5​%. The total simple interest due on the loans in one year was ​$ 4605 4605. The annual simple interest on the​ home-equity loan was ​$ 105 105 more than the interest on the​ business-equipment loan. How much did she borrow from each​ source?

Answer 1

Answer:

Business-equipment loan, A=$15000

Small-business loan, B=$24000

home-equity loan, C= $39000

Step-by-step explanation:

Let the Business-equipment loan at an interest rate of​ 11%=A

Let the​ small-business loan was at an interest rate of 5​% =B

Let her​ home-equity loan was at an interest rate of 4.5​%.=C

Since her total Loan=$78000

A+B+C=78000....(I)

Simple Interest = (P X R X T)/100

Since the Time, T=1 year

Interest on A = 0.11A

Interest on B = 0.05B

Interest on C = 0.045C

The total simple interest due on the loans in one year was ​$4605.

0.11A+0.05B+0.045C=4605....(II)

The annual simple interest on the​ home-equity loan was ​$105 more than the interest on the​ business-equipment loan.

0.045C = 0.11A +105...(III)

We proceed to solve the simultaneous equations.

A+B+C=78000....(I)

0.11A+0.05B+0.045C=4605....(II)

0.045C = 0.11A +105...(III)

From (III), 0.045C = 0.11A +105

Substitute 0.045C = 0.11A +105 into (II).

0.11A+0.05B+0.11A +105=4605

0.22A+0.05B=4500

From (III),

$C=\frac{22A}{9}+\frac{7000}{3}$

Substitute into (I)

$A+B+\frac{22A}{9}+\frac{7000}{3}=78000$

$\frac{31A}{9}+B=78000-\frac{7000}{3}$

$\frac{31A}{9}+B=\frac{227000}{3}$

$\frac{31A+9B}{9}=\frac{227000}{3}$

3(31A+9B)=9 X 227000

31A+9B=681000

0.22A+0.05B=4500 (Multiply by 9)

31A+9B=681000 (Multiply by 0.05)

1.98A+0.45B=40500

1.55A+0.45B=34050

Subtracting

0.43A=6450

A=$15000

From (III)

$C=\frac{22A}{9}+\frac{7000}{3}$

$C=\frac{22X15000}{9}+\frac{7000}{3} =39000$

C=$39000

from (I)

A+B+C=78000

15000+B+39000=78000

B=$24000