A retired person wants to invest up to an amount of ₹30,000 in fixed income securities. His Broker recommends investing in two bonds. Bond A yielding 7% and Bond B yielding 10%. After some consideration, he decides to invest at most ₹12,000 in bond B and atleast ₹6000 in bond A . He also wants the amount invested in bond A to be at least equal to the amount invested in bond B. How should broker recommend if the investor wants to maximize his return on investment? Solve by penalty cost method
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His broker recommends investing in two bonds--- bond A yielding 7% per annum and bond B yielding 10% per annum. After some consideration the person decides to invest at the most Rs. 12,000 in ...
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