Problema Solution
Susan invested part of her $40,000 bonus in a fund that paid a 12% profit and invested the rest in stock that suffered a 5% loss. Find the amount of each investment if her overall net profit was $1,910.
Answer provided by our tutors
Let x = fund amount, (40000 - x)= stock amount.
+12% = 1.12 = (rate of return for stock),
-5% =0.95 = (rate of return for stock),
0.95*x = stock amount at the end,
1.12*(40000 - x) = fund amount at the end,
$3780 is the profit, therefore
43780 is the amount at the end, and
43780 = [1.12*(40000 - x)] + (0.95*x)
Solve for x to get the beginning fund amount,
and (40000 - x) to get the beginning stock amount