Question

A financial consultant wishes to invest up to a total of $33,000 in two types of securities, one that yields 8% per year and another that yields 6% per year. Furthermore, she believes that the amount invested in the first security should be at most one-third of the amount invested in the second security. What investment program should the consultant pursue in order to maximize income?

The consultant should invest $___________ in the first security and $_______ in the second security to obtain the maximum income of $___________

Answer 1

Po = Amt. invested @ 6%.
Po/3 = Amt. invested @ 8%

Po + Po/3 = $33,000
3Po + Po = 99000
4Po = 99000
Po = $24,750 @ 6%.(2nd security).
Po/3 = 24,750/3 = $8,250 @ 8%.(1st security).

Int. = 24,750*0.06*1yr + 8,250*0.08*1yr=
$2145.