Question
An investor invests wants to invest up to $6 million in tech company stocks. The table below describes his options. Corporation Type Expected Annual Return
An investor invests wants to invest up to $6 million in tech company stocks. The table below describes his options. Corporation Type Expected Annual Return (in $1000s) Cost of Block (in $1000s) Apple X 40 384 Bumble Y 64 432 Cisco Y 72 544 DTOL Z 96 800 Esso X 88 560 Franlin Z 32 408 Google Z 60 720 Additional requirements of the investor: (a) At least two type Z corporations should be included. (b) No more than one type Y corporation should be included. (c) Exactly one type X corporation should be included. (d) If Bumble is included then Apple must also be included. Subject to the above requirements, the investor would like to maximize expected annual returns. Formulate the linear programming problem. Do not solve it. Hint: Use the following variables XA = 1 if the investor invests in Apple, 0 otherwise. XB = 1 if the investor invests in Bumble, 0 otherwise. XC = 1 if the investor invests in Cisco, 0 otherwise. XD = 1 if the investor invests in DTOL, 0 otherwise. XE = 1 if the investor invests in Esso, 0 otherwise. XF = 1 if the investor invests in Franklin, 0 otherwise. XG = 1 if the investor invests in Google, 0 otherwise.
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