Algebra question

[JennyM]

I am trying to find out how to do a problem in Math 1090 Business Algebra:

An investor has 600,000 to invest. There are 3 ways to invest this money. Municipal bonds pay 8% interest every year. Blue chip stocks should return 12% annually. Growth or speculative stocks should pay 15% annually. The investor wants to get a 10% return overall on his investments. Also, he wishes to invest twice as much in blue chip stocks as in growth or speculative stocks. How much should he invest in each type of investment?

 

[mmm4444bot]

much should he invest in each type of investment?

M = municipal-bond investment amount

B = blue-chip investment amount

G = growth investment amount



An investor has 600,000 to invest

M + B + G = 600000



Municipal bonds pay 8% interest every year. Blue chip stocks should return 12% annually. Growth or speculative stocks should pay 15% annually. The investor wants to get a 10% return overall on his investments.

8M + 12B + 15G = 10(600000)



he wishes to invest twice as much in blue chip stocks as in growth or speculative stocks.

B = 2G

Feel free to ask specific questions about anything in my posts that you do not understand.

The last three equations above form a "system of three equations in three unknowns".

To find the dollar amount represented by each of the symbols (M, B, and G), there are at least six different methods.

Do you have a favorite method for solving systems of equations ?

If you're not familiar with solving systems of equations, you could study the "substitution method" first. Click HERE for Google search results.