Question- An investor has $60,000 to invest in a CD and a mutual fund.The CD yields 5% and the mutual fund yields an average of 9%. The mutual fund requires a minimum investment of $10,000, the investors require that at least twice as much should be invested in Cd´s as in the mutual fund.How much should be invested in CD´s and how much in the mutual fund to maximize the return. What is the maximum return

Instruction- 1. Write the text of the question

2. Name the variables and show the system of inequalities.

3. Show the solving process.

4. Make a graph. You can use an app or draw very neat and use a ruler.

5. Show corner points on the graph.6. Discuss which are the minimum/maximum points and their meaning.

 

Answer:

1)let x be the amount invested in CD, y the amount invested in the mutual fund

first is to minimize the return R=0.05x+0.09y

x+y=<60,000---------amount to invest

y=>10,000--------------minimum for mutual fund

subject to x-2y=>0-----x is atleast 2y

and x=>0,y=>0

2)graph attached

3)maximum return is $3,800 when $40,000 is invested in CD, $20,000 in the mutual fund

Step-by-step explanation

let x be the amount invested in CD, y the amount invested in the mutual fund

first is to minimize the return R=0.05x+0.09y

x+y=<60,000---------amount to invest

y=>10,000--------------minimum for mutual fund

subject to x-2y=>0-----x is atleast 2y

and x=>0,y=>0

solved in the attached graph

the corner point function value table reads that;

R is at msaximum of 3,800 at (40,000, 20,000) that is

maximum return is $3,800 when $40,000 is invested in CD, $20,000 in the mutual fund

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https://drive.google.com/file/d/1sg8yDVq8OMnwzrIiUY_PmUS2pcVcrAe8/view?usp=sharing

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https://helpinhomework.org/blog/how-to-obtain-answer-through-google-drive-link