Question

Willie invests some money at 7.5%. He also invests $4,000 less than this amount at 6.5%. His total annual incomefrom the interest of these two investments is $1,000. How much money is invested at each rate?

Answer 1

To start we need to set up an equation to find the initial investment at 7.5%.

`\begin{gathered} .075I+.065(I-4000)=1000 \\ .075I+.065I-260=1000 \\ .14I=1260 \\ I=9000 \end{gathered}`

So the amount invested at 7.5% is 9000 and the amount invested at 6.5% is 9000-4000 which equals 5000.