Solving a Savings and Stock Interest Application Using a System of Equations
A system of equations can solve an application with two investments seeking a target overall interest rate. For instance, if Leon has to invest to earn interest per year, allocating it between a stock fund earning and a savings account earning , let and represent the amounts in the stock fund and savings account, respectively. The total principal equation is . The total interest equation is . Solving this system provides the optimal allocation: he should invest in the stock fund and in the savings account.
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OpenStax
Intermediate Algebra @ OpenStax
Ch.4 Systems of Linear Equations - Intermediate Algebra @ OpenStax
Algebra
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