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23 November, 19:59

A house wife invest RS 5000 at 5.5% her husband wishes to invest enough money to have 8% interest so that their total interest will amount to RS 1000 in a year the amount invested by husband is

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  1. 23 November, 21:00
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    The amount invested by husband is=$7,500

    Explanation:

    Step 1: Determine total amount that will yield a total interest of RS 1,000

    Use the expression below;

    T=W. I+H. I

    where;

    T=total interest amount

    W. I=wife's interest amount

    H. I=husband's interest amount

    In our case;

    T=RS 1,000

    W. I=PRT

    where;

    P=principal amount=RS 5,000

    R=annual interest rate=5.5%=5.5/100=0.055

    T=1

    W. I=5,000*0.055*1=$275

    H. I=unknown

    replacing;

    1,000=275+H. I

    H. I=1,000-275=$725

    Husband's interest amount=$725

    Step 2: Determine total principal combining for the husband and the wife

    Pt=Pw+Ph

    where;

    Pt=total principal

    Pw=wife principal

    Ph=husband principal

    In our case;

    Pt=1,000 / (0.08*1) = $12,500

    Pw=5,000

    Ph=unknown

    replacing;

    12,500=5,000+Ph

    Ph=12,500-5,000=7,500

    Husband principal=$7,500

    Step 2: Determine husbands interest rate

    Husband interest amount=Principal*interest rate*time

    where;

    Husband interest amount=725

    Principal=7,500

    interest rate=unknown=i%

    time=1

    replacing;

    725=7,500*0.01 i*1

    i=9.7%

    The husbands individual interest rate=9.7%
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