Important info at the end:
"with equal amounts
invested in short- and intermediate-term bonds. "
So let each of those amounts be x
then the amount invested at long-term be
100,000 - 2x
He wants to end up with a 5.1% profit on the total 100,000 or $5100
Now it is easy....
.04x + .05x + .06(100000-2x) = 5100
.09x + 6000 - .12x = 5100
-.03x = -900
x = 30,000
so .....
I will the substitutions up to you.
Also check the answers to see if they satisfy the original conditions.
An investor has $100,000 to invest in three types of
bonds: short-term, intermediate-term, and
long-term.How much should she invest in each type
to satisfy the given conditions?
Short-term bonds pay 4% annually,
intermediate-term bonds pay 5%, and long-term
bonds pay 6%. The investor wishes to realize a total
annual income of 5.1%, with equal amounts
invested in short- and intermediate-term bonds.
I don't understand the question at all, this is just an example problem for the chapter. Please help!
1 answer
1 answer