When Sara Whitehorse changed jobs, she rolled over the $43,650 in her retirement account into two simple interest accounts. On one account, the annual simple interest rate is 7.5%, and on the second account, the annual simple interest is 6%. How much must be invested in each account if the two accounts earned the same amount of annual interest? (x at 7.5% and y at 6%.) A.x = $19,400; y = $24,250 B.x = $19,500; y = $24,350 C.x = $19,410; y = $24,240 D. x = $24,250; y = $19,400 E.x = $19,501; y = $24,149
When Sara Whitehorse changed jobs, she rolled over the $43,650 in her retirement account into two simple interest accounts. On one account, the annual simple interest rate is 7.5%, and on the second account, the annual simple interest is 6%. How much must be invested in each account if the two accounts earned the same amount of annual interest? (x at 7.5% and y at 6%.) A.x = $19,400; y = $24,250 B.x = $19,500; y = $24,350 C.x = $19,410; y = $24,240 D. x = $24,250; y = $19,400 E.x = $19,501; y = $24,149
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:When Sara Whitehorse changed jobs, she rolled over the $43,650 in her retirement account into two simple interest accounts. On one
account, the annual simple interest rate is 7.5%, and on the second account, the annual simple interest is 6%.
How much must be invested in each account if the two accounts earned the same amount of annual interest?
(x at 7.5% and y at 6%.)
A.x = $19,400; y = $24,250
B.x = $19,500; y = $24,350
C.x = $19,410; y = $24,240
D.x = $24,250; y = $19,400
E.x = $19,501; y = $24,149
Expert Solution
Introduction
The interest calculated only on the principal portion of an investment is called as the simple interest. Simple interest is the product of principal amount, interest rate and time.
Sara has deposited the sum of $43,650 for her retirement in two separate simple interest rate accounts of 7.5% and 6% respectively.
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