Final answer:
After setting up a system of equations based on the information provided and solving for the amounts invested in each fund, we find that John invested $2,000 in a money-market fund, $3,000 in municipal bonds, and $7,000 in mutual funds. However, these amounts do not match the options provided, indicating a possible error in the options or the need for a recalculation.
Step-by-step explanation:
To solve this problem, we can set up a system of equations based on the information provided. Let's define the following variables:
- x = the amount invested in municipal bonds
- x + 4000 = the amount invested in mutual funds
- 12000 - x - (x + 4000) = the amount invested in the money-market fund
Now, based on the interest rates provided, we can write the following equation for the total interest earned in one year:
0.03(12000 - x - (x + 4000)) + 0.04x + 0.07(x + 4000) = 670
Simplifying the equation:
360 - 0.07x - 0.03x - 0.12 + 0.04x + 0.07x + 280 = 670
0.01x = 670 - 640
x = 3000
Therefore, John invested $3,000 in municipal bonds, $7,000 in mutual funds ($3,000 + $4,000), and $2,000 in the money-market fund ($12,000 - $3,000 - $7,000).
The correct answer is:
Money-market fund: $2,000, Municipal bonds: $3,000, Mutual funds: $7,000
However, it seems there was an error since none of the options match the correct calculation. The amounts should be recalculated or the options reviewed to ensure the correct answer is provided.