An investor has $60,000 to invest in a CD and a mutual fund. The CD yields 7% and the mutual fund yields 8%. The mutual fund requires a minimum investment of $9,000, and the investor requires that at least twice as much should be invested in CDs as in the mutual fund. How much should be invested in CDs and how much in the mutual fund to maximize the return? What is the maximum return? To maximize income, the investor should place $ in CDs and $ in the mutual fund. (Round to the nearest dollar as needed.)
An investor has $60,000 to invest in a CD and a mutual fund. The CD yields 7% and the mutual fund yields 8%. The mutual fund requires a minimum investment of $9,000, and the investor requires that at least twice as much should be invested in CDs as in the mutual fund. How much should be invested in CDs and how much in the mutual fund to maximize the return? What is the maximum return? To maximize income, the investor should place $ in CDs and $ in the mutual fund. (Round to the nearest dollar as needed.)
Chapter12: Sequences, Series And Binomial Theorem
Section12.3: Geometric Sequences And Series
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Transcribed Image Text:An investor has $60,000 to invest in a CD and a mutual fund. The CD yields 7% and the mutual fund yields 8%. The mutual fund
requires a minimum investment of $9,000, and the investor requires that at least twice as much should be invested in CDs as in the
mutual fund. How much should be invested in CDs and how much in the mutual fund to maximize the return? What is the maximum
return?
To maximize income, the investor should place $
in CDs and $ in the mutual fund. (Round to the nearest dollar as needed.)
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11 Whats the maximum return ?
Transcribed Image Text:### Investment Strategy: CD and Mutual Fund Allocation
**Scenario:**
An investor has $60,000 to invest in a Certificate of Deposit (CD) and a mutual fund. The CD yields 7%, and the mutual fund yields 8%. The mutual fund requires a minimum investment of $9,000, and the investor requires that at least twice as much should be invested in CDs as in the mutual fund.
**Problem Statement:**
How much should be invested in CDs and how much in the mutual fund to maximize the return? What is the maximum return?
**Solution:**
To maximize income, the investor should place **$40,000** in CDs and **$20,000** in the mutual fund.
**Calculations:**
- **Investment in CDs:** $40,000
- **Investment in Mutual Fund:** $20,000
These values are determined to satisfy the conditions of at least twice the investment in CDs as in the mutual fund and also meeting the minimum requirement of $9,000 in the mutual fund.
**Note:**
The maximum return calculation is to be rounded to the nearest dollar.
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This solution ensures the investor meets all the requirements and constraints while optimizing the returns from the investments.
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