Question

ralph chase plans to sell a piece of property for $140000. he wants the money to be paid off in two ways – a short - term note at 10% interest and a long - term note at 7% interest. find the amount of each note if the total annual interest paid is $12050.
the amount of the 10% note is $\square$ and the amount of the 7% note is $\square$.

Explanation:

Step1: Set up the interest equation

The total interest is the sum of the interest from the 10% note and the 7% note. So we have the equation: $0.10x + 0.07(140000 - x) = 12050$.

Step2: Expand and simplify the equation

First, expand $0.07(140000 - x)$: $0.10x + 9800 - 0.07x = 12050$. Then combine like terms: $0.03x + 9800 = 12050$.

Step3: Solve for x

Subtract 9800 from both sides: $0.03x = 12050 - 9800 = 2250$. Then divide both sides by 0.03: $x = \frac{2250}{0.03} = 75000$.

Step4: Find the amount of the 7% note

The amount of the 7% note is $140000 - x = 140000 - 75000 = 65000$.

Answer:

The amount of the 10% note is $75000$ and the amount of the 7% note is $65000$.