Solve the problem.
-Kevin invested part of his $5000 bonus in a certificate of deposit that paid 2% annual simple interest, and the remainder in a mutual fund that paid 4% annual simple interest. If his total
Interest for that year was $110, how much did Kevin invest in the mutual fund?
A) $4879.00
B) $500.00
C) $610.00
D) $4989.00

Question

Quizplus · Accepted Answer

Let the amount invested in the certificate of deposit be $x. Therefore, the amount invested in the mutual fund is $5000 - x. The interest from the certificate of deposit is 0.02x, and the interest from the mutual fund is 0.04(5000 - x). The total interest is $110, so we have the equation 0.02x + 0.04(5000 - x) = 110. Solving this equation for x gives us the amount invested in the certificate of deposit, and subtracting this from $5000 gives the amount invested in the mutual fund, which is $500.

Solve the Problem. -Kevin Invested Part of His $5000 Bonus in a Certificate