An investment of 5000 was made one year ago.
Part of the investment was placed into an account paying s interest at 4%
The remainder of the investment was placed into an account paying s interest at 6.5%
After one year, you received a total of 250 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 5000 - x
Calculate Interest Credit for Fund 1
Since Fund 1 credits interest using the simple interest method, we have 0.04x
Calculate Interest Credit for Fund 2
Since Fund 2 credits interest using the simple interest method, we have 0.065(5000 - x)
Set up a grid with fund details:
| Interest Paid | Principal | Interest Rate | |
| Fund 1 | 0.04x | x | 4% |
| Fund 2 | 0.065(5000 - x) | (5000 - x) | 6.5% |
| Total | 250 | 5000 | -- |
Calculate x from the grid:
Since both Interest paid columns add up to the total interest earned of 250, we set up an equation
0.04x + 0.065(5000 - x) = 250
0.04x + 325 - 0.065x = 250
325 - 0.025x = 250
Subtract 325 from each side:
325 - 325 - 0.025x = 250 - 325
Cancelling the 325 on the left side, we get:
-0.025x = -75
Divide each side by -0.025
| -0.025x | |
| -0.025 |
| = |
| -75 |
| -0.025 |
Cancelling the -0.025 on the left side, we get:
x = 3000 ← Fund 1 Investment
This means we should 5000 - 3000 = 2000 into Fund 2
Final Answer
2000 into Fund 2
You have 2 free calculationss remaining
What is the Answer?
2000 into Fund 2
How does the Split Fund Interest Calculator work?
This calculator has 4 inputs.
What 3 formulas are used for the Split Fund Interest Calculator?
Fund 2 investment is T - x
Interest paid = Interest Rate * Investment
For more math formulas, check out our Formula Dossier
What 3 concepts are covered in the Split Fund Interest Calculator?
- interest
- payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum, at a particular rate
- principal
- The amount borrowed on a loan, before interest is charged
- split fund interest
Example calculations for the Split Fund Interest Calculator
- 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?
- An investment of 20000 was made one year ago. Part of the investment was placed into an account paying s interest at 6% The remainder of the investment was placed into an account paying s interest at 8% After one year, you received a total of 900 in interest. How much was invested in each account?
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