Nigel's Investment

Algebra Level 2

If Nigel had earned one fourth of a percent more in annual interest on an investment, the interest for one year would have been $45 greater. How much did he invest at the beginning of the year?

Note: If you enjoyed this question, try Nigel's Investment 2 .


The answer is 18000.

Terry McTerrier by Terry McTerrier , 21, USA

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3 solutions

let x+0.0025x=x+45, then x+0.0025x-x=45, next 0.0025x=45, then x=45/0.0025, finally x=18000

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relly

Maynard Sarmiento - 7 years, 2 months ago
Nisarg Thakkar
Apr 16, 2014

as for me, i am was not comfortable with the language of question as it appeared to me that

one fourth of a percent more in annual interest meant "25% of interest" in which case the question wouldn't be solvable due to 2 unknown variables (principle amount and the interest)

so I ended up figuring out that the phrase meant 25 basis points more that initial interest. (100 basis point = 1%)

hence, we then assume Principle amount= x and differential interest is 0.25%. so we get,

0.0025 × x = $ 45 0.0025 \times x=\$45 implies, x = 18000 x=18000

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Khandakar Rahman
Mar 18, 2014

Let the Investment is X and interest percent is 10% As per terms, (0.1x+0.0025x) - x = 45 [1/4th of "a" percent] or, 0.0025x = 45 So, x = 18,000

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