A mother wants to invest 700000 for her sons future educatio

A mother wants to invest $7.000.00 for her son\'s future education She invests a portion of the money in a bank certificate of deposit (CD account) which earns 4% and the remainder in a savings bond that earns 7%. the total interest earned after one year is $420.00. how much money was invested in the CD account\'1 The total interest earned after one year is $420.00. How much money was invested in the CD account\'1 (Round to the nearest cent if necessary.)

Solution

Total amt invested ----$ 7, 000

Let $x amt be invested in CD @ rate 4%

Interest in one year = (x*4*1/100) = 0.04x

$( 7000 -x) amt be invested in savings bond @ 7%

Interest in one year = (7000-x)*7/100 =490 - 0.07x

Total interest 0.04x +490 -0.07x = $420

-0.03x =-70

x = $2333.33 @ 4% in invested CD