=3.18.* Al Ferris has $60,000 that he wishes to invest now in order to use the accumulation for purchasing a retirement annuity in five years. After consulting with his financial advisor, he has been offered four types of fixed-income investments, which we will label as investments A, B, C, and D.

Investments A and B are available at the beginning of each of the next five years (call them years 1 to 5). Each dollar invested in A at the beginning of a year returns $1.40 (a profit of $0.40)

two years later (in time for immediate reinvestment). Each dollar invested in B at the beginning of a year returns $1.70 three years later.

Investments C and D will each be available at one time in the future. Each dollar invested in C at the beginning of year 2 returns $1.90 at the end of year 5. Each dollar invested in D at the beginning of year 5 returns $1.30 at the end of year 5.

Al wishes to know which investment plan maximizes the amount of money that can be accumulated by the beginning of year 6.

a. For this problem, all its functional constraints can be expressed as fixed-requirement constraints. To do this, let At

, Bt

, Ct

, and Dt be the amounts invested in investments A, B, C, and D, respectively, at the beginning of year t for each t where the investment is available and will mature by the end of year 5. Also let Rt be the number of available dollars not invested at the beginning of year t

(and so available for investment in a later year).

Thus, the amount invested at the beginning of year t plus Rt must equal the number of dollars available for investment at that time. Write such an equation in terms of the relevant variables above for the beginning of each of the five years to obtain the five fixed-requirement constraints for this problem.

b. Formulate a complete linear programming model for this problem in algebraic form.