Question

Stephanie puede invertir a una tasa de 3.8%, hasta un máximo de $5,000 y no más de 36 meses. El banco, por otro lado, le ofrece, el 2.4%, condicionado a 60 meses o menos y $12,000 máximos. ¿Cuál sería la estrategia optima de inversión si ella cuenta con $9,000.00?

Stephanie can invest at a rate of 3.8%, up to a maximum of $ 5,000 and no more than 36 months. The bank, on the other hand, offers you 2.4%, conditioned to 60 months or less and $ 12,000 maximum. What would be the optimal investment strategy if she has $ 9,000.00? Present and argue the result of your recommendation.

Answer 1

Optimal Investment Strategy:

This type of strategy is for the risky asset and optimal strategy for investment is prepared for the long term growth rate. An optimum investment is one which is for long term and also growth rate is consider. and analysis that optimum policy is one which gives maximum return not in the short period but also in the long period

As per this requirement :

Option one is to make investment of $5,000 and rate of return is 3.8% but maximum up to 36 month and another option is for 60 month and investment up to $12,000 and rate of return is 2.4% so it is to be analysis that second option is better compare to the first one as rate of return is steady one and also it is essential for long term project .

As $9,000 is recommended to be invest under the second option due to the fact that option second is better on the ground of steady rate and also investment for the maximum month.

Although first option is good for the short period as it give higher return but from the long period prospective option second is better and recommended.