A Stockbroker Has Money in Three Accounts

question 14

Multiple Choice

A stockbroker has money in three accounts. The interest rates on the three accounts are 8%, 10%, and 12%. If she has twice as much money invested at 10% as she has invested at 8%, three times as much at 12% as she has at 8%, and the total interest for the year is $384, how much is invested at each rate? ( Hint : Let x = the amount invested at 8%.)

• A) $597 invested at 8% $1,194 invested at 10%, $1,791 invested at 12%
• B) $660 invested at 8% $1,320 invested at 10%, $1,980 invested at 12%
• C) $510 invested at 8% $1,020 invested at 10%, $1,530 invested at 12%
• D) $735 invested at 8% $1,470 invested at 10%, $2,205 invested at 12%
• E) $600 invested at 8% $1,200 invested at 10%, $1,800 invested at 12%

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Definitions:

Hard Rationing

A situation where companies cannot obtain funds for projects despite having positive net present values due to external financing constraints.

Capital Funds

Financial resources that are used to fund a company's operations and growth, typically sourced from equity or debt.

Net Present Value

A method to evaluate the profitability of an investment by calculating the difference between the present value of cash inflows and outflows over a period.

Variable Costs

Expenses that fluctuate in direct proportion to the quantity of output or sales, including items like labor and materials.