Solving an Investment Fund Interest Application Using a System of Equations
To solve an interest application where a principal is divided between two investments, apply a system of equations by adapting the mixture table method. For example, if Adnan has to invest and hopes to earn interest per year, splitting it between a stock fund earning and bonds earning , let be the amount in stocks and be the amount in bonds. The total principal gives the first equation: . The total interest gives the second equation: . Solving this system, such as by multiplying the top equation by to eliminate , yields and . Adnan should invest in stocks and in bonds.
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Intermediate Algebra @ OpenStax
Ch.4 Systems of Linear Equations - Intermediate Algebra @ OpenStax
Algebra
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