posted by gaurav .
4. You have $55000 to invest, and two funds you would like to invest in. The You-Risk-It Fund yields 13% interest. The Extra-Dull Fund yields 7% interest. Because of the college financial aid implications, you don’t think you can afford to earn more than $6500 in interest income this year. How should you put in each fund?
Let X be the amount invested at 13% interest
Let Y be the amount invested at 7% interest
0.13X + 0.07 Y = 6500 (maximum without financial aid penalty)
X + Y = 55,000
0.13X + 0.13Y = 7150
0.06Y = 650
Y = 10,833.33 at 7%
X = 44,166.67 at 13%