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-   -   How do I write the equation? (https://www.askmehelpdesk.com/showthread.php?t=356326)

  • May 21, 2009, 05:26 AM
    brassy333
    How do I write the equation?
    Helen Weller invested $10,000 in an account that pays 10% simple interest. How much additional moneymust be invested in an account that pays 13% simple interest so that the average return on the two investments amounts to 11%?

    I know the answer is $5,000.00 but I am unsure how to set up the problem to show that solution. Could you help me?
  • May 21, 2009, 08:07 AM
    Unknown008

    Ok, let's first give the amount a name, say 'x'

    (13% of x) + (10% of 10000) gives (11% of x + 10000) where x+10000 is the total sum.

    So, in numbers;



    When you simply, solve for x and you're done. Post back if you have any difficulties.

    Hope it helped! :)
  • May 21, 2009, 08:09 AM
    Perito
    Quote:

    $10,000 invested in an account that pays 10% simple interest.
    How much additional money must be invested in an account that pays 13% simple interest so that the average return on the two investments amounts to 11%?

    I know the answer is $5,000.00
    $10000 x 0.10 = $1000 is the annual interest at 10% on $10,000

    Let A be the amount that's invested at 13%

    The amount earning interest at 10% plus the amount that's invested at 13% equals the two amounts as if they had been invested at 11%. This is the equation that results.

    ($10000 x 0.10) + (A x 0.13) = ($10000 + A) x 0.11

    We need to solve for A and check that it's correct by substituting back into the equation.

    I see that Unknown008 beat me to the punch.

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