A pension fund manager decides to invest a total of at most $35 million in U.S. Treasury bonds paying 4% annual interest and in mutual funds paying 7% annual interest. He plans to invest at least 5$ million in bonds and at least 20$ million in mutual funds. Bonds have an initial fee of $100 per million dollars, while the fee for mutual funds is $200 per million. The fund manager is allowed to spend no more than $6000 on fees. How much should be invested in each to maximize annual interest? What is the maximum annual interest?
A pension fund manager decides to invest a total of at most $35 million in U.S. Treasury bonds paying 4% annual interest and in mutual funds paying 7% annual interest. He plans to invest at least 5$ million in bonds and at least 20$ million in mutual funds. Bonds have an initial fee of $100 per million dollars, while the fee for mutual funds is $200 per million. The fund manager is allowed to spend no more than $6000 on fees. How much should be invested in each to maximize annual interest? What is the maximum annual interest?
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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A pension fund manager decides to invest a total of at most $35 million in U.S. Treasury bonds paying 4% annual interest and in mutual funds paying 7% annual interest. He plans to invest at least 5$ million in bonds and at least 20$ million in mutual funds. Bonds have an initial fee of $100 per million dollars, while the fee for mutual funds is $200 per million. The fund manager is allowed to spend no more than $6000 on fees. How much should be invested in each to maximize annual interest? What is the maximum annual interest?
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