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If you give x money to the bank paying 6% interest, then the amount of interest received is 0.06*x.

If you gave x to the first account, the money left over must be 12600-x, so if you give 12600-x money to the second account, the interest is 0.08*(12600-x)

Now we want both amounts of interest to be equal so,

0.06x = 0.08(12600-x)

=> 0.06x = 0.08*12600 - 0.08x

=> 0.06x = 1008 - 0.08x

=> 0.06x + 0.08x = 1008

=> 0.14x = 1008

=> x = 1008/0.14 = 7200

You give 7200 to the 6% interest account, as you chose to give them x money.

You have 5400 money left to give to the 8% interest account (12600 - x).

Q: How can 12600 be split between two investments one patying 6 percent annually and one paying 8 percent annually so that the amounts of interest from the two investments are equal?

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The answer depends on the interest rates on offer and these will vary between lending establishments and between countries.

One person (or organisation) pays interest to another - who earns it.

The Present Value Interest Factor PVIF is used to find the present value of future payments, by discounting them at some specific rate. It decreases the amount. It is always less than oneBut, the Future Value Interest Factor FVIF is used to find the future value of present amounts. It increases the present amount. It is always greater than one.

So ordinary interest is 30 days collecting or gathering interest on a dollar and exact is collecting or gathering 1 year interest on a dollar.

P(r/100)^2

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