You borrow $500 to buy a computer. The simple interest rate is 15%. You pay off the loan after 4 years. How much do you pay for
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Answer:
$2000 is invested at 8%
$2000 is invested at 14%
Step-by-step explanation:
A total of $4000 is invested part at 8% and the remainder at 14%
Annual interest is $440.
Simple interest formula;
I = P × R × T
Where I is the interest, P is the principal, R is the rate and T is the time.
P = $4000
R = 8% and 14%
T = 1 year
I = $440
Let's say $a is invested at 8% and;
$b is invested at 14%
Then,
($a × × 1 ) + ($b ×
× 1) = $440
and
$a + $b = $4000
This forms a simultaneous equation;
0.08a + 0.14b = 440 ... (i)
a + b = 4000 ... (ii)
Multiplying (i) by 1 and (ii) by 0.08 we get;
0.08a + 0.14b = 440 ... (i)
0.08a + 0.08b = 320 ... (ii)
Subtracting (i) - (ii) we get;
0 + 0.06b = 120
0.06b = 120
b = 120 ÷ 0.06 = 2000
So amount invested at 14% ($b) = $2000 and,
The amount invested at 8% ($a) = $4000 - $2000 = $2000