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14 October, 04:22

Kelly Fisher invested a total of $20,000 in two municipal bonds that have yields of 7% and 10% interest per year, respectively. If the interest Kelly receives from the bonds in a year is $1580, how much did she invest in each bond? (Let x and y denote the amount, in dollars, invested at 7% and 10%, respectively.)

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  1. 14 October, 04:23
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    Kelly invested $14,000 in bond - 1 and $6000 in bond-2.

    Explanation:

    Let the x amount be invested in bond and y amount in other bond.

    total amount invested = $,20,000

    x + y = $20,000 ... [1]

    Interest rate on bond-1 = 7%

    Amount of interest received from bond - 1 = 0.07x

    Interest rate on bond-2 = 10%

    Amount of interest received from bond - 2 = 0.1y

    Total interest received = $1580

    0.07x + 0.1y = $1580 ... [2]

    Solving [1] and [2], we get:

    y = $6,000

    x = $14,000

    Kelly invested $14,000 in bond - 1 and $6000 in bond-2.
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