Math Problem Statement

One safe investment pays 10% per year, and a more risky investment pays 18% per year. A woman who has $140,900 to invest would like to have an income of $19,130 per year from her investments. How much should she invest at each rate? 10% $ 18% $

Solution

Let's define the amounts the woman should invest at each rate as follows:

  • Let xx be the amount invested at 10%.
  • Let yy be the amount invested at 18%.

We know the following:

  1. The total investment is $140,900, so: x+y=140,900x + y = 140,900
  2. The total income from both investments should be $19,130. The income from the 10% investment is 0.10x0.10x, and the income from the 18% investment is 0.18y0.18y. Thus: 0.10x+0.18y=19,1300.10x + 0.18y = 19,130

Now, we can solve this system of equations:

Equation 1:

x+y=140,900x + y = 140,900 Solve for yy: y=140,900xy = 140,900 - x

Equation 2:

0.10x+0.18y=19,1300.10x + 0.18y = 19,130 Substitute y=140,900xy = 140,900 - x into the second equation: 0.10x+0.18(140,900x)=19,1300.10x + 0.18(140,900 - x) = 19,130 Now simplify and solve for xx: 0.10x+0.18×140,9000.18x=19,1300.10x + 0.18 \times 140,900 - 0.18x = 19,130 0.10x+25,3620.18x=19,1300.10x + 25,362 - 0.18x = 19,130 0.08x+25,362=19,130-0.08x + 25,362 = 19,130 0.08x=19,13025,362-0.08x = 19,130 - 25,362 0.08x=6,232-0.08x = -6,232 x=6,2320.08=77,900x = \frac{-6,232}{-0.08} = 77,900

So, she should invest $77,900 at 10%.

To find yy, substitute x=77,900x = 77,900 into the first equation: y=140,90077,900=63,000y = 140,900 - 77,900 = 63,000

Final answer:

  • She should invest $77,900 at 10%.
  • She should invest $63,000 at 18%.

Would you like further details or have any other questions?

Here are some related questions for further practice:

  1. What if the total investment amount was $150,000? How would the investment amounts change?
  2. How would the amounts change if the income requirement was $20,000 per year?
  3. What would the total income be if the entire $140,900 was invested at 18%?
  4. If the income requirement was reduced to $18,000, how much would she invest at each rate?
  5. How would the amounts change if the risky investment paid 20% per year?

Tip: When solving systems of equations, substitution is useful when one variable can easily be expressed in terms of the other.

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Math Problem Analysis

Mathematical Concepts

Algebra
Linear Equations
System of Equations

Formulas

x + y = 140,900
0.10x + 0.18y = 19,130

Theorems

Substitution Method

Suitable Grade Level

Grades 10-12