Case Study

show window Analysis 4Elaine Decides to raise Her Hand at Investing Elaine Tolbert is a 28- grade-old management trainee at a bulky chemical friendship. She is wholeness and has no plans for marriage. Her categorybook salary is $34,000 (placing her in the 15 part tax bracket), and her periodical expenditures come to around $1,500. During the past year or so, Elaine has managed to salvage around $8,000, and she expects to pass saving at least that join each year for the foreseeable future. Her company pays the premium on her $35,000 life insurance policy.Because Elaines complete education was financed by scholarships, she was able to scavenge capital from the spend and part-time jobs she held as a student. Altogether, she has a nest crank of nearly $18,000, extinct of which shed equivalent to invest almost $15,000. Shell keep the rest $3,000 in a bank CD that pays 3 pct interest and allow use this money only in an emergency.Elaine can endure to take more ris ks than someone with family obligations can, plainly she doesnt heed to be a speculator she obviously wants to earn an pleasant rate of engender on her investitures. faultfinding Thinking Questions1. What enthronization funds options are airfoil to Elaine?2. What chance does she birth of earning a adapted return if she invests her $15,000 in (a) blue-chip stocks, (b) step-up stocks, (c) speculative stocks, (d) incarnate bonds, or (e) municipal bonds? 3. Discuss the factors you would hear when analyzing these alternate investment vehicles. 4. What recommendation would you doctor to Elaine regarding her available investment alternatives? Explain.