Word Problem about Stocks and Bonds, In a 7th grade algebra course.

Question

Timothy invests $4000 in stocks and bonds. The stocks go up 20% and the bonds go up 5%. The total investment goes up 17%. How many dollars did Timothy invest in stocks? How many in bonds?

Answer 1

Initial Investment = $4000

Investment Earned 17% so 4000(.17)= 680

Amount Invested x Rate = Earned

Stock = .20x

Bond = 4000-x = .05(4000 -x)

.20x+.05(4000-x)=680

.20x+200-.05x=680

.15x+200=680

.15x=480, divide both sides by .15

x=3200

Answer : $3,200 at 20%

$ 800 at 5%

Check : 3200(.20)=640

800(.05) =40

640+40=680

4000(.17)=680