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5. National Insurance Associates carries an investment portfolio of stocks, bonds, and other investment alternatives. Currently $200,000 of funds are available and all the money

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5. National Insurance Associates carries an investment portfolio of stocks, bonds, and other investment alternatives. Currently $200,000 of funds are available and all the money must be considered for new investment opportunities. The four stock options National is considering and the relevant financial data are as follows: Stock A B D Price per share 100 50 80 40 Annual rate of return 0.12 0.08 0.06 0.10 Risk measure per dollar invested 0.10 0.07 0.05 0.08 The risk measure indicates the relative uncertainty associated with the stock in terms of its realizing the projected annual return; higher values indicate greater risk. The risk measures are provided by the firms top financial advisor. Nationals top management has stipulated the following investment guidelines: the annual rate of return for the portfolio must be at least 9% and no one stock can account for more than 30% of the total dollar investment. (a) Formulate the Linear Optimization Model that National Insurance Associates use to develop an investment portfolio that minimizes risk

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