Problema Solution
After one year, the interest earned on a $7,000 investment exceeds the interest earned on a $5,000 investment by $150. The interest rate for the $7,000 investment is 1.5% greater than the interest rate for the $5,000 investment. Find the interest rate for both investments. (hint: think about our example in class and how interest is calculated
Answer provided by our tutors
let
x = interest rate for the $7,000 investment then the interest earned will be x*7000/100 = 70*x
y = interest rate for the $5,000 investment then the interest earned will be y*5000/100 = 50*y
70*x = 50*y + 150
x = y + 1.5
by solving this system we find
x = 3.75%
y = 2.75%
the interest rate for the $7,000 investment is 3.75%
the interest rate for the $5,000 investment is 2.75%