Financial Planning A young couple has $25,000 to invest.

Chapter 12, Problem 86

(choose chapter or problem)

Financial Planning A young couple has $25,000 to invest. As their financial consultant, you recommend that they invest some money in Treasury bills that yield 7%, some money in corporate bonds that yield 9%, and some money in junk bonds that yield 11%. Prepare a table showing the various ways that this couple can achieve the following goals: (a) $1500 per year in income (b) $2000 per year in income (c) $2500 per year in income (d) What advice would you give this couple regarding the income that they require and the choices available? [Hint: Higher yields generally carry more risk.]

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