Question

You invest $40,000 in two funds paying 4% and 52% simple interest. The total annual interest is $2080. How much do you invest in each fund?
4% fund:
52% fund:

Answer 1

9514 1404 393

Answer:

• 4% fund: $39,000
• 52% fund: $1000

Step-by-step explanation:

Let x represent the amount invested at 52%. Then (40000-x) is the amount invested at 4%. The total annual interest is ...

  0.52x +0.04(40000-x) = 2080

  0.48x = 480 . . . . . . . . . subtract 1600, simplify

  x = 1000 . . . . . . . . . divide by 0.48

Then the amounts invested in each fund are ...

  4% fund: $39,000

  52% fund: $1000