Josh and Ginger decide to place $14,900 of their savings into investments. They put some in a money market account earning 5.1 % interest, some in a mutual fund that has been averaging 6.9% a year, and some in a stock that rose 9.1% last year. If they put $1,600 more in the money market than in the mutual fund and the mutual fund and stocks have the same growth in the next year as they did in the previous year, they will earn $1,006.7 in a year. How much money did they put in each of the three investments?
A) $6,000 at 5.1%, $7,600 at 6.9%, $1,300 at 9.1%
B) $6,200 at 5.1%, $4,600 at 6.9%, $4,100 at 9.1%
C) $4,600 at 5.1%, $4,100 at 6.9%, $6,200 at 9.1%
D) $7,600 at 5.1%, $1,300 at 6.9%, $6,000 at 9.1%

Question

Quizplus · Accepted Answer

Let's denote the amount of money put in the mutual fund as x. Since they put $1,600 more in the money market than in the mutual fund, the amount in the money market is x + $1,600. The total investment is $14,900, so the amount put in stocks is $14,900 - (x + $1,600) - x = $14,900 - 2x - $1,600. The total interest earned is $1,006.7, which is the sum of the interests from each investment. The equation for the total interest is 0.051(x + $1,600) + 0.069x + 0.091($14,900 - 2x - $1,600) = $1,006.7. Solving this equation gives x (the amount in the mutual fund) as $4,600, the amount in the money market as $6,200, and the amount in stocks as $4,100, which matches option B.

Josh and Ginger Decide to Place $14,900 of Their Savings