A person wishes to invest R120 000 in three types of bonds:

Question

A person wishes to invest R120 000 in three types of bonds:
 municipal bonds (MF) paying 6% p.a.,
 bank investment certificates (BF) paying 7% p.a. and
 high-risk bonds (HF) paying on average 10% p.a.
For tax purposes, the person wants the amount invested in municipal bonds (MF) to be at
least 2 times the amount invested in the bank certificates (BF).
To lower the level of risk the person will invest no more than R30 000 in high-risk bonds (HF)

Please help me find the equations so that i can solve the problems

Steve · Answer

I assume you want to maximize .06m + .07b + .10h subject to the constraints m >= 2b h <= 30000 m+b+h = 120000 plot the lines and pick a vertex. hint: m+b >= 90000

Tshegofatso · Answer

Thanks Man this really helped.