SOLUTION: Arlene purchased municipal bonds which yield 6% annually and certificates of deposit which yield 7% annually. If Arlene’s initial investments amount to $17,000 and the annual inc
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Question 1190150: Arlene purchased municipal bonds which yield 6% annually and certificates of deposit which yield 7% annually. If Arlene’s initial investments amount to $17,000 and the annual income is $1,150, how much money is invested in bonds?
Answer by greenestamps(13200) (Show Source): You can put this solution on YOUR website!
Using formal algebra....
x = amount at 6%
17000-x = amount at 7%
Total interest income $1150
Solve using basic algebra.... I leave that to you.
If formal algebra is not required....
(1) $17000 all invested at 6% would yield $1020 income; all at 7% would yield $1190 income; the actual income was $1150.
(2) Look at the three income amounts on a number line -- 1020, 1150, and 1190 -- and observe/calculate that $1150 is 130/170 = 13/17 of the way from $1020 to $1190.
(3) That means 13/17 of the total was invested at the higher rate.
ANSWER: 13/17 of $17,000, or $13,000, at 7%; the other $4000 at 6%
CHECK: .07(13000)+.06(4000)=910+240=1150
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