Muir investments carries an investment portfolio of stocks. Currently $500,000 of funds are available and the entire amount must be invested. The three-stock option Muir is considering and the relevant financial data are as follows:

Stock A Stock B Stock C

Price per share $50 $40 $60

Annual rate of return 12% 10% 13%

Risk measure 8 4 10

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. Muirs top management has stipulated the following investment guidelines: the annual rate of return for the portfolio must be at least 11%, and Stock B must account for at least 20% of the total dollar investment.

Set the problem up as a linear programming problem that minimizes risk. Dont forget the nonnegativity constraint. DO NOT SOLVE!!!!

Which of the following constraint would require that Stock B account for at least 20% of the total dollar investment.

	a.	.8x1 + .2x2 + .2x3 > 0
	b.	.2x1 + .8x2 + .2x3 > 0
	c.	-.2x1 + .2x2 - .2x3 > 0
	d.	-.2x1 + .8x2 - .2x3 > 0