Question: You want to save for a down payment on a house that costs $300,000 in 5 years. You have $100,000 to invest and want to
You want to save for a down payment on a house that costs $300,000 in 5 years. You have $100,000 to invest and want to invest it in a portfolio of stocks and bonds. You believe that a portfolio of 60% stocks and 40% bonds will give you the best balance between risk and return. You expect the annual return on stocks to be 10% and the annual return on bonds to be 5%. Assuming that these rates of return remain constant over the 5 years, how much money will you have for your down payment in 5 years?
Step by Step Solution
3.50 Rating (153 Votes )
There are 3 Steps involved in it
The detailed answer for the above question is provided below To calculate the future value of your i... View full answer
Get step-by-step solutions from verified subject matter experts
