Question

Suppose that you have received an unexpected inheritance of $36,000. You have decided to invest the money by placing some of the money in stocks and some in bonds. To diversify, you decided that five times the amount in bonds should equal three times the amount invested in stocks. How much should be invested in stocks? Bonds?

Need to know how to set it up!! Hellp

Answer 1

Let B be the amount in stocks and S be the amount in bonds. Do the algebra.

5 B = 3 S
B + S = 36,000
5B + 5S = 180,000
Substitute 3S for 5B
8S = 180,000
S = 22,500
B = 36,000 - S = 13,500