SOLUTION: A high school student was able to save $7000 by working a part-time job every summer. He invested half the money in a money market account and half the money in a stock that paid t

Algebra ->  Percentage-and-ratio-word-problems -> SOLUTION: A high school student was able to save $7000 by working a part-time job every summer. He invested half the money in a money market account and half the money in a stock that paid t      Log On


   

Question 1199237: A high school student was able to save $7000 by working a part-time job every summer. He invested half the money in a money market account and half the money in a stock that paid three times as much interest as the money market account. After a year he earned $490 in interest. What were the interest rates of the money market account and the stock?
Answer in percentages and round to one decimal place.
Answer by greenestamps(13203) About Me  (Show Source):
You can put this solution on YOUR website!


let x be the interest rate for the money market
then 3x is the interest rate for the stock

Half of $7000, or $3500, invested at each rate yields $490 interest:

3500%28x%29%2B3500%283x%29=490
3500%284x%29=490
x=490%2F%2814000%29=7%2F200=.035

ANSWERS:
interest rate on money market: x = .035 = 3.5%
interest rate on stock: 3x = .105 = 10.5%

CHECK: 3500(.035)+3500(.105) = 122.5 + 367.5 = 490