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Ling Blair & Rosen, Inc. (B&R), is a brokerage firm that specializes in investment portfolios designed to meet the specific risk tolerances of its

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Ling Blair & Rosen, Inc. (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 this past week has a maximum of $55,000 to invest. B&R's investment advisor decides to recommend a portfolio consisting of two investment funds: an Internet fund and a Blue Chip fund. The Internet fund has a projected annual return of 9%, whereas the Blue Chip fund has a projected annual return of 8%. The investment advisor requires that at most $40,000 of the client's funds should be invested in the Internet fund. B&R services include a risk rating for each investment alternative. The Internet fund, which is the more risky of the two investment alternatives, has a risk rating of 6 per thousand dollars invested. The Blue Chip fund has a risk rating of 4 per thousand dollars 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)+4(10) 100. Finally, B&R developed a questionnaire to measure each client's risk tolerance. Based on the responses, each client is classified as a conservative, moderate, or aggressive investor. Suppose that the questionnaire results classified the current dient as a moderate investor: B&R recommends that a client who is a moderate investor limit his or her portfolio to a maximum risk rating of 260. (a) Formulate a linear programming model to find the best investment strategy for this client. (Assume N is the amount invested in the internet fund project and is the amount invested in the Blue Chip fund. Express the amounts invested in thousands of dollars) Max st Available investment funds Maximum investment in the internet fund Maximum risk for a moderate investor N820 (b) Build a spreadsheet model and solve the problem using Excel Solver What is the recommended investment portfolio (in dollars) for this client internet fund s blue chip fund

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