Problema Solution
A couple need $6,000 per year. They have $150,000 to invest to obtain this income. They decided on two investment options: Corporate bonds yielding 6% per annum and a Bank certificate yielding 3% per annum.
a) how much should be invested in each to realize exactly $6,000?
b) If, after two years, the couple requires $7,000 per year in income, how should they relocate their investment to achieve new amount?
Answer provided by our tutors
let
x = the money invested in corporate bonds
y = the money invested in ban certificates
a) how much should be invested in each to realize exactly $6,000?
x + y = 150000
0.06x + 0.03y = 6000
by solving the above system of equations we find:
x = $50,000
y = $100,000
click here to see the step by step solution of the system of equations:
they should invest $50,000 in corporate bonds and $100,000 in bank certificates.
b) If, after two years, the couple requires $7,000 per year in income, how should they relocate their investment to achieve new amount?
x + y = 150000
0.06x + 0.03y = 7000
by solving the above system of equations we find:
x = $83,333.33
y = $66,666.67
click here to see the step by step solution of the system of equations:
they should invest $83,333.33 in corporate bonds and $66,666.67 in bank certificates.