Split Fund Interest with Principal of 10000 and Fund 1 = 5% and Fund 2 = 10% and Interest Paid = 800

Principal =
Fund 1 Interest = %
Fund 2 Interest = %
Total Interest paid =
  

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An investment of 10000 was made one year ago.
Part of the investment was placed into an account paying s interest at 5%
The remainder of the investment was placed into an account paying s interest at 10%
After one year, you received a total of 800 in interest. How much was invested in each account?

Calculate Principal Amounts for each fund:

For Fund 1, we invest an unknown amount, let us call it x
For Fund 2, the remaining principal is 10000 - x

Calculate Interest Credit for Fund 1

Since Fund 1 credits interest using the simple interest method, we have 0.05x

Calculate Interest Credit for Fund 2

Since Fund 2 credits interest using the simple interest method, we have 0.1(10000 - x)

Set up a grid with fund details:

	Interest Paid	Principal	Interest Rate
Fund 1	0.05x	x	5%
Fund 2	0.1(10000 - x)	(10000 - x)	10%
Total	800	10000	--

Calculate x from the grid:

Since both Interest paid columns add up to the total interest earned of 800, we set up an equation
0.05x + 0.1(10000 - x) = 800
0.05x + 1000 - 0.1x = 800
1000 - 0.05x = 800

Subtract 1000 from each side:

1000 - 1000 - 0.05x = 800 - 1000

Cancelling the 1000 on the left side, we get:

-0.05x = -200

Divide each side by -0.05

-0.05x
-0.05

=

-200

-0.05

Cancelling the -0.05 on the left side, we get:

x = 4000 ← Fund 1 Investment
This means we should 10000 - 4000 = 6000 into Fund 2

Final Answer

See Answer

4000 into Fund 1
6000 into Fund 2

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Tags:

• interest
• principal
• split fund interest

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