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longz002 · Jun 18, 2007, 07:45 PM

Larry has an annual return of $213 from $3,000 invested at simple interest. Some at 5% and the rest at 8%. How much is invested at each rate? I need to understand how to solve this problem , so can you show me the steps and logic that you use to solve it?
THanks!!

Capuchin · Jun 18, 2007, 11:51 PM

You need to solve this for n:

$3000*1.05^{\frac{n}{365}}*1.08^{\frac{365-n}{365}} = 3213$

Where n is the number of days that the 5% interest rate was applied.

Do you understand how i made that equation?

galactus · Jun 19, 2007, 06:56 AM

Actually, I think it may be simpler than that.

Let x=amount invested at 5%

$.05x+.08(3000-x)=213$

Solve for x.

Capuchin · Jun 19, 2007, 10:03 AM

Ohhh, I worked it out for 3000 invested for n days at 5% and 365-n days at 8%.

I didn't interpret the question properly, but was interesting nonetheless.

Well done gal :)