A financier plans to invest up to $500,000 in two projects.

Mathematics
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A financier plans to invest up to $500,000 in two projects. Project A yields a return of 10% on the investment of x dollars, whereas Project yields a return of 16% on the investment of y dollars. Because the investment in Project B is riskier than the investment in Project A, she has decided that the investment in Project B should not exceed 40% of the total investment. How much should the financier invest in each project in order to maximize the return on her investment?

Jun 4th, 2015

Thank you for the opportunity to help you with your question!

Let he invest $X  in project A & $Y in project B
therefore X +Y = 500000   

aim : maximise : Yield = 0.10X + 0.16Y

Y <=0.4 *500000 =200000

this is a linear programming problem & Can be solved using EXCEL

... maximum investment in project B is 200000 in this case investment in project A = 300000

yield : 0.1* 300000+0.16*200000=  $ 62000

If  reducing investment on B let us say 190000 then investment in project A will be 310000

&  yield : 0.1* 310000+0.16*190000=  $ 61400

hence yield start reducing therefore correct answer

Project A :  300000

Project B : 200000


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Please find the solution enclosed here with .. In case of any doubt please feel free to ask… Do not forget to best my answer… If you are having some other problem please feel free to contact me for quick & quality services.. Use my promo code: Saro
Jun 4th, 2015

The answer was marked wrong! :( Can you help me again this is the question incase it still isn't posted


A financier plans to invest up to $500,000 in two projects. Project A yields a return of 10% on the investment of x dollars, whereas Project Byields a return of 16% on the investment of y dollars. Because the investment in Project B is riskier than the investment in Project A, she has decided that the investment in Project B should not exceed 40% of the total investment. How much should the financier invest in each project in order to maximize the return on her investment?

(x, y) = 



What is the maximum return?
$ 

Jun 4th, 2015

(x, y) =(300000 , 200000) & return = $62000

do you mean to say this is wrong ???


Jun 4th, 2015

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