Question

A total of $7500 is deposited into two simple interest accounts. In one account, the annual simple interest rate is 5%, and in the other account, the annual simple interest rate is 7%. The amount of interest earned in 1 year was $405. How much was invested in each account?

Answer 1

Answer: $6000 was deposited in the account earning 5% interest.

$1500 deposited in the account earning 7% interest.

Step-by-step explanation:

Let x represent the amount which he deposited in the account earning 5% interest.

Let y represent the amount which he deposited in the account earning 7% interest.

A total of $7500 is deposited into two simple interest accounts. In one account, the annual simple interest rate is 5%, and in the other account, the annual simple interest rate is 7%. . This means that

x + y = 7500

The formula for determining simple interest is expressed as

I = PRT/100

Considering the account earning 5% interest,

P = $x

T = 1 year

R = 5℅

I = (x × 5 × 1)/100 = 0.05x

Considering the account earning 7% interest,

P = $y

T = 1 year

R = 7℅

I = (y × 7 × 1)/100 = 0.07y

The amount of interest earned in 1 year was $405. it means that

0.05x + 0.07y = 405 - - - - - - - - - -1

Substituting x = 7500 - y into equation 1, it becomes

0.05(7500 - y) + 0.07y = 405

375 - 0.05y + 0.07y = 405

- 0.05y + 0.07y = 405 - 375

0.02y = 30

y = 30/0.02

y = $1500

x = 7500 - y = 7500 - 1500

x = $6000