How much was invested in stocks and how much was invested in bonds?

Question

Michelle invested $12,000 in sticks and bonds,paying 4.8% and 7% anual interest,respectively.If the total interest earned for the year was $763,

Answer 1

To represent how much we invested in stocks and how much we invested in bonds, we can call these amounts S and B.

We know that S and B add up to $12,000, so we can make an equation

S + B = 12000

We know that stocks gave us 4.8% and bonds gave us 7%, and these gave us $763.

We can create an equation from this information:

.048S + .07B = 763

We can use information from the first equation to help us work with this equation:

Since S+B=12000, we can say something like

S = 12000-B

We can then use this information by substituting 12000-B into S for the second equation, like so:

.048(12000-B) + .07B = 763

This multiplies out to

576-.048B + .07B = 763

We can then combine B terms

576 + .022B = 763

Subtract 576 from both sides

.022B = 187

Lastly, divide both sides by .022

B = 8,500

So we have 8.500 in bonds. That means that

S+8,500=12,000

S = 12,000-8,500

S = 3,500

$3,500 in stocks

$8,500 in bonds