Question

To save for the purchase of a new car, a deposit was made into an account that earns 8% annual simple interest. Another deposit, $1700 less than the first deposit, was placed in a certificate of deposit (CD) earning 12% annual simple interest. The total interest earned on both accounts for 1 year was $676. How much money was deposited in the CD?

$

Answer 1

To find the amount deposited in the CD, set up an equation using the given information. Solve for x to find the amount of the first deposit. Subtract $1700 from the first deposit to find the amount deposited in the CD.

Step-by-step explanation:

To find the amount of money deposited in the CD, we can set up an equation using the given information.

Let the amount of the first deposit be x.

The second deposit is $1700 less than the first deposit, so it is x - $1700.

Using the formula for simple interest, the interest earned on the first deposit is x * 0.08.

The interest earned on the second deposit is (x - $1700) * 0.12.

According to the given information, the total interest earned is $676. Therefore, we can set up the equation: x * 0.08 + (x - $1700) * 0.12 = $676.

Simplifying and solving for x:

0.08x + 0.12x - $204 = $676

0.20x - $204 = $676

0.20x = $880

x = $4400

Therefore, the amount of money deposited in the CD is $4400 - $1700 = $2700.

Answer 2

The amount deposited in CD is $660

Solution:

Given that , To save for the purchase of a new car, a deposit was made into an account that earns 8% annual simple interest.

Let the amount deposited in new car be $ n

Another deposit, $1700 less than the first deposit, was placed in a certificate of deposit (CD) earning 12% annual simple interest.

Then, amount deposited in CD will be $ (n – 1700)

The total interest earned on both accounts for 1 year was $676

The simple interest is given as:

`\text { Simple interest }=\frac{\text { principal } * \text {rate} * \text {time}}{100}`

Simple interest for purchase of new car:

`\text { S. } \mathrm{I}=(n * 8 * 1)/(100)=(8 n)/(100)`

Simple interest for CD:

`\text { S.I } =((n-1700) * 12 * 1)/(100)=(12(n-1700))/(100)`

Now, given that S.I for new car + S.I for CD = 676

`\begin{array}{l}{(8 n)/(100)+(12(n-1700))/(100)=676} \\\\ {(8 n+12 n-12 * 1700)/(100)=676}\end{array}`

20n = 67600 – 20400

n = 2360

So money deposited in CD = n - 1700 = 2360 – 1700 = 660

Hence, the CD deposit amount is $660