SOLUTION: Steve, a recent retiree, requires $5000 per year in extra income. He has $70,000 to invest and can invest in A-rated bonds paying 8% per year or in a certificate of deposit (CD) pa

Question 1207785: Steve, a recent retiree, requires $5000 per year in extra income. He has $70,000 to invest and can invest in A-rated bonds paying 8% per year or in a certificate of deposit (CD) paying 5% per year. How much money should be invested in each to realize exactly $5000 in interest per year?

Here is my system of equations:

x + y = 70,000
0.08x + 0.05y = 5,000

Note:
Let x = A-rated bonds
Let y = CD

Is my set up correct?

Answer by ikleyn(52776) (Show Source): You can put this solution on YOUR website!
.

This setup is correct.

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