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Word problem - bank and bonds

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You win a $10,000 prize that you decide you want to invest so that the investment pays out $660 a year in interest without using any of the principal- You will use this money for birthday gifts! Your financial advisor advises you to put part of it in a bank at 5 percent interest. He puts the remainder in bonds, which pay a 9 percent annual return. How much did he invest in each method- bank and bonds- to come up with an annual combined income of $660?

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Solution Summary

This looks at bank and bonds and sets up equations to solve for a specified income.

Solution Preview

For the $10,000 prize, suppose you put x dollars in a bank at 5% interest and y dollars in bonds which pay a 9%
annual return. Then we have x + y = 10000. Since ...

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