On April 1, Alex deposited $2,000 in an MMDA that pays 3% interest. On July 1, Alex invested $3,000 in a six-month CD that pays 6% interest. How much total interest will Alex have earned by December 31?

Question

Quizplus · Accepted Answer

Alex earns interest from two sources: the MMDA for 9 months at 3% annually and the CD for 6 months at 6% annually. For the MMDA: $2,000 * 3% * (9/12) = $45. For the CD: $3,000 * 6% * (6/12) = $90. Total interest = $45 + $90 = $135.

On April 1, Alex Deposited $2,000 in an MMDA That