Simple Interest?

You have been given $20 000 from your parents to place in two different investments (Silicon World and Solar Energy). Silicon World offers an annual interest rate of 10% and Solar Energy offers a 6% annual interest rate. Together the investments return a total of$1800 at the end of the year. Determine the amount of money placed in each investment. Justify your answer?

Feb 27, 2018

Amount of money placed in Silicon world = $15000 and Amount of money placed in Solar Energy = $5000

Explanation:

Given: $20 000 Place in two different investments (Silicon World and Solar Energy). Let the amount placed in Silicon world be $x$Silicon World offers an annual interest rate of 10% So the interest on this amount will be given by: $S {I}_{1} = \frac{P R T}{100} = \frac{x \times 10 \times 1}{100} = 0.1 x$where, P is principal amount invested R is rate of interest, and T is duration of investment which is given to be 1 year. Now the amount invested in Solar Energy will be $20000 - x$It offers a 6% annual interest rate, so the simple interest at the end of 1 year on this will be: $S {I}_{2} = \frac{P R T}{100} = \frac{\left(20000 - x\right) \times 6 \times 1}{100}$$S {I}_{2} = \frac{120000 - 6 x}{100}$Given that: together the investments return a total of$1800 at the end of the year.

$\implies S {I}_{1} + S {I}_{2} = 1800$

$\implies 0.1 x + \frac{120000 - 6 x}{100} = 1800$

$\implies 10 x + 120000 - 6 x = 180000$

$\implies 4 x = 180000 - 120000 = 60000$

$\implies x = 15000$

$\therefore$ Amount of money placed in investment Silicon world is $15000 and Amount of money placed in Solar Energy was$20000-15000 = $5000 Cross heck: 1 : Silicon world: Amount invested:$15000 at rate 10% for 1 year will return interest: $15000 xx 10 /100xx 1 =$1500
and
2: Solar energy : amount invested : $5000 at rate of 6% for 1 year will return interest : $5000 xx 6/100 xx 1 = $300 Total returns from 1 and 2 : $1500 + $300 =$ 1800#