John has $20,000 to invest in three funds Fl, F2 and F3. Fund Fl is offers a return of 2% and has a low risk. Fund F2 offers a return of 4% and has a medium risk. Fund F3 offers a return of 5% but has a high risk. To be on the safe side, John invests no more than $3000 in F3 and at least twice as much as in Fl than in F2. Assuming that the rates hold till the end of the year, what amounts should he invest in each fund in order to maximize the year end return?

Answer rating: 100% (QA)

Let x be the amount invested in F1 y the amount invested in F2 and z the amount invested in F1 x y z ... View the full answer