You Have Inherited $250,000

question 39

Essay

You have inherited $250,000. You have decided that since you don't need the money currently, you should invest the money in order to meet future expenses. After seeking advice, you decide on an asset allocation plan that puts 10% in short-term securities, 75% in equities, and 15% in bond funds. How much money would you put in each category? (Show all work.)

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Definitions:

Billiards

A cue sport that encompasses a wide variety of games involving pool tables, cue sticks, and balls, where players strike balls to score points based on game-specific rules.

Limited Resources

The finite availability of inputs (like labor, capital, and land) that are used for the production of goods and services.

Economics

A branch of social science that examines the methods by which people, governmental bodies, corporations, and states allocate finite resources to meet their infinite needs.

Opportunity Cost

The cost of foregone alternatives when a decision is made, essentially what is given up to undertake a certain action.