Help with an investment matrix word problem

In summary, the problem is about determining how much should be invested in three different funds (stock, precious metals, and bonds) in order to earn a total return of $4000. One of the equations needed to solve this problem is (0.3xM)x(1.09) + (0.2xM)x(1.40) + (0.5xM)x(1.03) - M = 4000, where M represents the total amount of money invested.
  • #1
kdubb22
4
0
Help with an investment matrix word problem!

Can anyone give me the 3 equations in general form that I need to solve this matrix?

A person will put 30% of his investment into a stock fund that earns a 9% annual rate of return. He will put 20% in precious metals currently growing at 40% and the remainder into bond funds earning 3%. His goal is to have $4000 of interest income. How much should he put into each investment?

One of the equations should be the equation for the statement about interest.
 
Mathematics news on Phys.org
  • #2


I don't think this is a matrix kind of problem...it is a single equation:

(0.3xM)x(1.09) + (0.2xM)x(1.40) + (0.5xM)x(1.03) - M = 4000

M is the amount of money that needs to be invested to get 4000 of interest income
 
  • #3


kdubb22 said:
Can anyone give me the 3 equations in general form that I need to solve this matrix?

A person will put 30% of his investment into a stock fund that earns a 9% annual rate of return. He will put 20% in precious metals currently growing at 40% and the remainder into bond funds earning 3%. His goal is to have $4000 of interest income. How much should he put into each investment?

One of the equations should be the equation for the statement about interest.
Do you really mean interest should be $4000, or total return? The reason I ask is that only the bonds return interest.
 

1. What is an investment matrix?

An investment matrix is a table or grid that displays different investment options and their corresponding returns over a specific period of time. It is used to compare and evaluate different investment opportunities.

2. How do I create an investment matrix?

To create an investment matrix, you need to list all the investment options in the first column, and then calculate and fill in the corresponding returns for each option in the subsequent columns. The final column should display the total returns for each option.

3. How can I use an investment matrix to make investment decisions?

An investment matrix can help you make informed investment decisions by allowing you to compare and evaluate different options based on their potential returns. You can use it to identify the most profitable investment opportunity or to diversify your investments.

4. What are the benefits of using an investment matrix?

There are several benefits of using an investment matrix, including:

  • It provides a visual representation of different investment options, making it easier to compare and evaluate them.
  • It allows you to consider multiple factors, such as returns, risks, and timeframes, when making investment decisions.
  • It can help you identify the most profitable and suitable investment opportunities.

5. Are there any limitations of using an investment matrix?

While an investment matrix can be a useful tool, it also has some limitations, including:

  • It relies on assumptions and estimates, so the actual returns may differ from the projected ones.
  • It may not take into account external factors, such as market fluctuations or unforeseen events, that can affect the returns of an investment.
  • It should not be the only factor considered when making investment decisions, and other factors such as personal financial goals and risk tolerance should also be taken into account.

Similar threads

MHB Solving an Investment Word Problem
    • General Math
Replies
7
Views
2K
MHB Solve Investment Problem: Net Profit $1,850 from $13,500 Bonus
    • General Math
Replies
5
Views
2K
MHB How Much Should Art Invest for an Annuity of 8,000 for Three Years?
    • General Math
Replies
4
Views
2K
MHB How to Solve Investment Word Problems Involving Interest Rates and Profits?
    • General Math
Replies
1
Views
3K
MHB Investment Problem: $12,000 Net Profit of $120
    • General Math
Replies
1
Views
2K
MHB Find Constant % of Annual Salary to Reach Retirement Goal
    • General Math
Replies
9
Views
2K
Simple Interest for two investments
    • Precalculus Mathematics Homework Help
Replies
9
Views
2K
To supercharge science, first experiment with how it is funded
    • General Discussion
Replies
7
Views
675
Using a Problem Solving Technique for a simple word problem
    • STEM Educators and Teaching
Replies
24
Views
2K
Problem about Financial Planning
    • Precalculus Mathematics Homework Help
Replies
16
Views
4K

Hot Threads

Recent Insights

Back
Top