Bob and Dora Sweet Wish to Start Investing $1,000 Each

question 17

Essay

Bob and Dora Sweet wish to start investing $1,000 each month.The Sweets are looking at five investment plans and wish to maximize their expected return each month.Assume interest rates remain fixed and once their investment plan is selected they do not change their mind.The investment plans offered are:
Fidelity 9.1% return per year
Optima 16.1% return per year CaseWay 7.3% return per year Safeway 5.6% return per year
National 12.3% return per year
Since Optima and National are riskier,the Sweets want a limit of 30% per month of their total investments placed in these two investments.Since Safeway and Fidelity are low risk,they want at least 40% of their investment total placed in these investments.
Formulate the LP model for this problem.

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Definitions:

Meeting Minutes

The written record of the events, discussions, and decisions of a meeting, intended to provide an official and organized documentation of the meeting's proceedings.

Indirect Costs

Expenses not directly tied to the production of goods or services but are necessary for the overall operation, such as utilities or administrative salaries.

Intangible Expenses

Costs associated with non-physical assets or activities, such as branding, intellectual property, or research and development.

Clerical Expenses

Costs associated with administrative tasks and office support services.