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A trust officer at the Blacksburg National Bank needs to determine how to invest $100,000 in the following collection of bonds to maximize the annual
A trust officer at the Blacksburg National Bank needs to determine how to invest $100,000 in the following collection of bonds to maximize the annual return. Bond Annual Return Risk A B D E 9.5% 8.0% 9.0% 9.0% 9.0% Maturity Long Short Long Long Short High Low Low High High Tax-Free Yes Yes No Yes No The officer wants to invest at least 50% of the money in short-term issues and no more than 50% in high-risk issues. At least 30% of the funds should go into tax-free investments and at least 40% of the total annual return should be tax-free. Hint: the formula for the last condition/constraint is: 0.095A + 0.08B + 0.09D 20.4* (0.095A + 0.08B + 0.09C + 0.09D + 0.09E) -What is the goal of this problem -how many decision variables are there? what is the value of the objective function_ a Ignoring the constraints, the value of the objective function would have to e between and how many $ of A bonds How many $ of B bonds How many dollars of C bonds How many dollar of D bond_ How many dollar of E bonds
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