Can anyone help me solve this problem ? I have no idea how to do it. An investor invested a total of $1,900 in two mutual funds, one fund earned a 7% profit, while the other earned a 4% profit. If the investor's total profit was $97, how much was invested into each mutual fund?

Question

allank · Answer

In this case I think we can safely assume that the interest is compounded continuously for a period of time. Assume that the amount of money invested in the 7% fund be x. Thus the total amount of money after some time t is given by the equations: 
For the 7% 
A(t) = 1.07t*x
For the 4%:
A(t) = 1.04t*(1900-x)
So the total amount is given by:
 (1.07t*x)+(1.04t*(1900-x))
The total profit equation is therefore: 
97 = 1900-[(1.07t*x)+(1.04t*(1900-x))]
Solving for x should give the solution.

saifoo.khan · Answer

x+y = 1900                    -eq1

0.04x + 0.07y = 97        -eq2

Now solve both of them.