document.write( "Question 1034261: Consider an investor with a portfolio totaling $500000 that is invested in certificates of deposit, municipal bonds, blue-chip stocks, and growth or speculative stocks. The certificates of deposit pay 3% annually, and the municipal bonds pay 5% annually. Over a five-year period, the investor expects the blue-chip stocks to return 8% annually and the growth stocks to return 10% annually. The investor wants a combined annual return of 5% and also wants to have only one-fourth of the portfolio invested in stocks. How much is invested in each type of investment? The answers in the back of the book are 187500+s in certificates of deposit, 187500-s in municipal bonds, and 125000-s where s is in growth stocks. I'm not sure as how they got to these answers. \n" ); document.write( "

Algebra.Com's Answer #649011 by addingup(3677) $\"\"$ $\"About$

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The last answer is obvious. The problem says that 1/4 of the portfolio must be invested in stocks.
\n" ); document.write( "There are two types of stocks:
\n" ); document.write( "Blue-Chip
\n" ); document.write( "Growth - Lets call these s. Therefore,
\n" ); document.write( "total in blue-chips = 125,000-s, where s is growth stocks
\n" ); document.write( "Now you have 500000-125,000 = 375,000 and 375,000/2 = 187,500 and this is the amount that is invested each in munis and CDs. I don't know why one says -s and the other +s \n" ); document.write( "

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