A combined total of $50,000 is invested in two bonds that pay 3% and 7.5% simple interest. The annual interest is $2,760.00. How much is invested in each bond?

Question

The amount invested at 3% is $ .

The amount invested at 7.5% is $ .

Answer 1

3(x) +7.5(50-x) = 276

3x + 375-7.5x = 276

4.5x = 375-276 = 99

x = 99/4.5 = $22,044.44 invested at 3%

50-x = $27,955.55 invested at 7.5%

2,760 is 5.52% of $50,000

the average of 3 and 7.5 = 5.25%

You want more than the average. Had you only wanted the average percent return, it would have been equally divided at $25,000 invested at each, 3 and 7.5% But you need more interest, so you invest slightly more at 7.5%