An Investor Is Developing a Portfolio of Stocks $\quad 0.00009 \mathrm{P}_{1}^{2}+0.00032 \mathrm{P}_{2}^{2}+0.00122 \mathrm{P}_{3}^{2}$

question 64

Essay

An investor is developing a portfolio of stocks. She has identified 3 stocks in which to invest. She wants to earn at least 11% return but with minimum risk.
Let: P_i = proportion of total funds invested in i, i = A, B, C
The NLP for this problem is:
MIN: $\quad 0.00009 \mathrm{P}_{1}^{2}+0.00032 \mathrm{P}_{2}^{2}+0.00122 \mathrm{P}_{3}^{2}$
$+2\left(-0.00009 \mathrm{P}_{1} \mathrm{P}_{2}-0.00011 \mathrm{P}_{1} \mathrm{P}_{3}-0.00007 \mathrm{P}_{2} \mathrm{P}_{3}\right. )$

Subject to:
$\begin{array}{l}P_{1}+P_{2}+P_{3}=1 \\0.1072 P_{1}+0.1068 P_{2}+0.1187 P_{3} \geq 0.11 \\P_{1}, P_{2}, P_{3} \geq 0 \\P_{1}, P_{2}, P_{3} \leq 1\end{array}$
What formulas should go in cells G4:J14 of the spreadsheet for this problem? NOTE: Formulas are not required in all of these cells.

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