An Investor Has $450,000 to Invest in Two Types of Investments.Type

question 9

Multiple Choice

An investor has $450,000 to invest in two types of investments.Type A pays 6% annually and type B pays 7% annually.To have a well-balanced portfolio,the investor imposes the following conditions.At least one-third of the total portfolio is to be allocated to type A investments and at least one-third of the portfolio is to be allocated to type B investments.What is the optimal amount that should be invested in each investment?

• A)$160,000 in type A (6%),$290,000 in type B (7%)
• B)$0 in type A (6%),$450,000 in type B (7%)
• C)$450,000 in type A (6%),$0 in type B (7%)
• D)$300,000 in type A (6%),$150,000 in type B (7%)
• E)$150,000 in type A (6%),$300,000 in type B (7%)

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Definitions:

Behavioural Impulses

Behavioural impulses are spontaneous urges to act in certain ways, often without conscious deliberation, driven by psychological or physiological needs.

Conflict

A situation or process that involves opposing actions or viewpoints, leading to a state of tension or disagreement.

Pressure

The application of force upon a surface by an object, fluid, etc., in contact with it or the stress or urgency of matters demanding attention.

Principal Types

Main or leading categories or kinds within a larger group or system.