Question

John invest $5,000 in one account and $8,000 in an account paying 4% more in interest. He earned $1,230 in interest after one year. At what rates did he invest​

Answer 1

Given:

John invest $5,000 in one account and $8,000 in an account paying 4% more in interest.

Total interest in one year = $1230

To find:

The rates of the investments.

Solution:

Let x% be the rate of interest on investment $5000.

Then, (x+4)% is the rate of interest on investment $8000.

Total interest is $1230. So,

$5000\times \dfrac{x}{100}+8000\times \dfrac{x+4}{100}=1230$

$50x+80(x+4)=1230$

$50x+80x+320=1230$

$130x=1230-320$

$130x=910$

Divide both sides by 130.

$x=\dfrac{910}{130}$

$x=7$

Now,

$x\%=7\%$

$(x+4)\%=(7+4)\%=11\%$

Therefore, $5,000 is invested at 7% and $8,000 is invested at 11%.