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1. After working as a data analyst for many years, Beth decided to apply for a JD program in 5 years, which means she could
1. After working as a data analyst for many years, Beth decided to apply for a JD program in 5 years, which means she could start to invest right now at year one and pay the tuition at the beginning of year 5. She decides to invest money on four targets as A, B, C, and a saving account so that she can use the returns to pay the expenses when she is in school. The details of available years, maturity, and total return at maturity for those targets are listed in the following table. She needs at least $10,000 invested in the saving account at the beginning of each year. She estimates the annual expense of a 3-year program is $80,000, $80,000, $90,000. What is the minimal amount of money she is supposed to raise at the beginning of year one to cover the expenses with the help of the investments and with the requirements on the saving account? Available Investments Available Years Yield at Maturity Total Return Saving Account 1,2,3,4,5,6 1 1.00% A 1,3,5 4.00% 1,4 OWN 6.00% 1 12.00% a) Construct a table and write the table down. The table shall include components like years and investment targets, availability as -1, and total returns for each target, as we covered in class. (1 points) b) Formulate the LP problem. (5 points) c) Solve the problem in excel solver and write down the minimal amount of money she is supposed to raise at the beginning of year one from your solver. (5 points) d) how much money will she save by this particular investment plan? (2 points)
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