A bank has set aside a maximum of $30 million for commercial and home loans. Every million dollars in commercial loans requires 2 application forms while every million dollars in home loans requires 3 forms. The bank cannot process more than 84 forms at this time. The bank's policy is to loan at least four times as much for home loans as for commercial loans. At least $10 million will be used for these two types of loans. The bank earns 10% on commercial loans and 12% on home loans. What amount of money should be allotted for each type of loan to maximize the interest income? The bank should allot $ million for commercial loans and s million for home loans. (Type integers or decimals rounded to two decimal places as needed.)
A bank has set aside a maximum of $30 million for commercial and home loans. Every million dollars in commercial loans requires 2 application forms while every million dollars in home loans requires 3 forms. The bank cannot process more than 84 forms at this time. The bank's policy is to loan at least four times as much for home loans as for commercial loans. At least $10 million will be used for these two types of loans. The bank earns 10% on commercial loans and 12% on home loans. What amount of money should be allotted for each type of loan to maximize the interest income? The bank should allot $ million for commercial loans and s million for home loans. (Type integers or decimals rounded to two decimal places as needed.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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The bank should allot $__________ million for commercial loans and
$________ million for home loans.
Transcribed Image Text:A bank has set aside a maximum of $30 million for commercial and home loans. Every million dollars in
commercial loans requires 2 application forms while every million dollars in home loans requires 3 forms. The
bank cannot process more than 84 forms at this time. The bank's policy is to loan at least four times as much for
home loans as for commercial loans. At least $10 million will be used for these two types of loans. The bank earns
10% on commercial loans and 12% on home loans. What amount of money should be allotted for each type of
loan to maximize the interest income?
The bank should allot S million for commercial loans and S million for home loans.
(Type integers or decimals rounded to two decimal places as needed.)
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