Question 31304: Doris has $20,000 to invest. Her financial planner recommends that she diversify into
three investments:
Treasury bills that yield 5% simple interest,
Treasury bonds that yield 7% simple interest, and corporate bonds that yield 10% simple interest.
Doris also wishes to earn $1390 per year in income.
Also, Doris wants her investment in Treasury bills to be $3000 more than her investment in corporate bonds.
How much money should Doris place in each investment?
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! Let "x" be amount invested in corporate bonds at 10%
Then "x+3000" is amount invested in treas. bills at 5%
And "20000-(x+x+3000)"="17000-2x" is amount invested in treas. bonds at 7%
EQUATION:
interest + interest+ interest= 1390
0.10x + 0.05(x+3000)+0.07(17000-2x)=1390
10x+5(x+3000)+7(17000-2x)=139000
10x+5x+15000+119000-14x=139000
x=5000 (amount invested at 10% in corporate bonds
x+3000=8000 (amount invested at 5% in treas. bills
17000-2x=17000-10000=7000 (amount invested at 7% in treas. bonds.
Cheers,
Stan H.
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