Question

An executive invests 29,000, some at 8% and the rest at 7% annual interest. If he receives an annual return of $2,230, how much is invested at each rate?

Answer 1

Answer:

Amount invested in A (8%) = $20,000

Amount invested in B (7%) = $9,000

Step-by-step explanation:

Given:

Total amount invested = $29,000

Interest rate A = 8% = 0.08

Interest rate B = 7% = 0.07

Annual return = $2,230

Find:

Amount invested in each

Computation:

Assume;

Amount invested in A = x

Amount invested in B = 29,000 - x

So,

Interest receive from A = x × 0.08

Interest receive from A = 0.08 x

Interest receive from B = (29000 - x) × 0.07

Interest receive from B = 2,030 - 0.07 x

Annual return = Interest receive from A + Interest receive from B

2,230 = 0.08 x + 2,030 - 0.07 x

x = 20,000

Amount invested in A = $20,000

Amount invested in B = 29,000 - $20,000

Amount invested in B = $9,000