An investor is considering three sorts of investments: a high-risk venture in oil leases with the potential return of 15%, medium-risk investment in stocks with the 9% return, and the relatively safe bond investment with 5% return. He has $50,000 to invest. Because of risk, he will limit his investment in oil leases and stocks to 30% and his investment in oil leases and bonds to 50%. How much must he invest in each to maximize his return, supposing investment returns are as expected?
- Maximum = $1650 with Stock = $10,000, Bonds = $15,000
- Maximum = $3650 with Oil = $15,000, Stock = $10,000, Bonds = $25,000
- Maximum = $2750 with Oil = $15,000, Bonds = $10,000
- Maximum = $2750 with Oil = $15,000, Stock = $10,000, Bonds = $25,000