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Chris takes out two loans. He borrows $800 more from a credit union that charges 12% interest than from a bank that charges 15% interest. If his interest payments total $420 annually, how much does he borrow at each rate?

  • Algebra -

    assuming no compunding of interest:
    borrow x at .15
    borrow (x+800) at .12
    .15 x + .12 (x+800) = 420

  • Algebra -

    let his loan from the bank be $x
    let the loan from the credit union be $(x+800)

    .15x + .12(x+800) = 420

    solve for x, let me know what you got.

  • Algebra -

    There has to be two equations. I got 1,200 for x...

  • Algebra -

    1200 and 2000 are the correct amounts.

  • Algebra -

    If you really, really, want to make two equations out of this:
    x = amount at .15
    y = amount at .12
    .15 x + .12 y = 420
    y = x + 800
    then substitute equation 2 into equation 1
    .15 x + .12(x+800) = 420
    which is where we started.

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