Lux Investing
A renowned mathematician recieved a 7000 bonus to accept tenured at a university. She invested part of the?
bonus in fixed income securities yielding 10% annually. The rest of the bonus money was invested in the high tech startup expecting to yield 32% annually to its investors. how much was invested in the tech business if she expected to earn 19320 annually from her investment
Public Comments
- Are u sure its 19320? Because its already more than 100% earning for the 7000. if she invested all the 7000 to the 32% = 7000 x 0.32 = it will only yield 2240. This is way below your 19320. Please check again the given figures. anvil ltd.
- A = Amount Grown P = Principle (amount you start with) n = How many time per year it compounds = 1 t = years it will grow = 1 r = interest rate, one is 10% or 0.1 and the other is 32% or 0.32 The formula is A = P•(1 + (r/n)^n•t Putting it all together, we have: 19320 = (7000-B)•(1+0.1/1)¹ + B•(1+0.32/1)¹ and solve for B 19320 = (7000 - B)(1.1) + B(1.32) 19320 = 7000-1.1B + 1.32B 12320 = 0.22B B = $56000 invested in the high tech company. Clearly higher than the original amount to invest for yielding your desired annual return of $19320.
