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Q72.

Expert-verifiedFound in: Page 690

Book edition
7th Edition

Author(s)
James Stewart, Lothar Redlin, Saleem Watson

Pages
948 pages

ISBN
9781337067508

**A man invests his savings in two accounts, one**

**paying 6% and the other paying 10% simple interest per year.**

**He puts twice as much in the lower-yielding account because**

**it is less risky. His annual interest is $3520. How much did**

**he invest at each rate?**

For the given investment problem the man invested **$32,000** at a rate of 6% and **$16,000 **at a rate of 10%.

x = the amount invested in the first account.

y = the amount invested in the second account.

x = 2y

x – 2y = 0 …….(1)

Also the total sum of interest earned would be,

0.06x + 0.1y = 3520 ……….(2)

Solving equation (1) and (2) we have,

20 $\times $ equation (1) gives 1.2x + 2y = 70400

Now adding this to equation (2), we get

2.2x = 70400

x = 32000

Substituting this in (1)

2y = 32000

Y = 16000

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