Question

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 $2420 dollars. How much did he invest at each rate

Answer 1

$11,000 - amount put in higher yielding account

$22,000 - amount he puts in the lower-yielding account

Step-by-step explanation:

simple interest = principal x time x interest rate

Let x = amount he put in the higher yielding account

let 2x = amount he puts in the lower-yielding account

(2x x 0.06 x 1 ) + (x x 0.1 x 1) = $2420

0.12x + 0.1x = $2420

0.22x = $2420

x = 11,000 = amount he put in the higher yielding account

amount he puts in the lower-yielding account = 2x = 11,000 x 2 = $22,000