A man would like to invest P50,000 in government bonds and stocks that will give an overall annual return of 5%. The money to be invested in government bonds will give an annual return of 4.5% and the stocks of about 6% annual return. The investments are in units of P100 each. If he desires to keep his stock investment to a minimum in order to reduce his risk, determine how many government bonds and how many stocks should he purchase?

A man would like to invest P50,000 in government bonds and stocks that will give an overall annual return of 5%. The money to be invested in government bonds will give an annual return of 4.5% and the stocks of about 6% annual return. The investments are in units of P100 each. If he desires to keep his stock investment to a minimum in order to reduce his risk, determine how many government bonds and how many stocks should he purchase?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 9P

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