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B&R is a brokerage firm that specializes in investment portfolios designed to meet the specific risk tolerances of its clients. A client who contacted

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B&R is a brokerage firm that specializes in investment portfolios designed to meet the specific risk tolerances of its clients. A client who contacted B&R has a maximum of $150,000 to invest. B&R recommends two investment funds: an Internet fund and a Blue Chip fund. The Internet fund has a projected annual return of 20 percent, and the Blue Chip fund has a projected annual return of 8 percent. At most $50,000 of the client's funds should be invested in the Internet fund. The Internet fund is more risky and has a risk rating of 6 per $1000 invested. The Blue Chip fund has a risk rating of 3 per $1000 invested. For example, if $10,000 is invested in each of the two investment funds, B&R's risk rating for the portfolio would be 6(10)+3(10)=90. B&R recommends this client to limit his portfolio to a maximum risk rating of 500. Build a spreadsheet model and solve the problem using Excel solver. What is the recommended investment amount in dollars for Internet fund and Blue Chip fund that maximizes total annual return? (answer in thousands (000s) without the $ sign - for example, $10,000 would be entered as 10.00, 2 decimal places.) Internet fund: Blue Chip fund: What is the maximum total annual return in dollars for the portfolio for this client? (answer in thousands (000s) without the $ sign - for example, $10,000 would be entered as 10.00, 2 decimal places) Annual Return: A B 123 1 B & R, Inc. 4 Parameters 5 Budget ($000) 6 Max Risk Rating 7 8 $150.00 500 C Internet Fund Blue Chip Fund 9 Annual Return % 20% 8% 10 Risk Rating per ($000) 3 11 Max Investment ($000) 50 12 13 14 15 Model 16 Amount to Invest ($000) 17 18 Total Invested ($000) 19 Total Risk Rating 20 21 Total Return ($000) 24 25 22322 Internet Fund Blue Chip Fund D

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