Recall the Innis Investments problem (Chapter 2, Problem 39). Letting S=units purchased in the stock fund M=units purchased in the money market fund leads to the following formulation: Min 83 + 3M S.L 505 + 100M S 1,200,000 Funds available 55 + 4M 2 60,000 Annual income M 2 3,000 Units in money market 53M 2 0 The computer solution is shown in Figure 3.16. ' a. What is the optimal solution, and what is the minimum total risk? b. Specify the objective coefficient ranges. c. How much annual income will be earned by the portfolio? FIGURE 3.16 THE SOLUTION FOR THE INNIS INVESTMENTS PROBLEM \\ Optimal Objective Value = 62000.00000 Variable Value Reduced Cost S 4000.00000 0.00000 M 10000.00000 0.00000 Constraint Slack/Surplus Dual Value 1 0.00000 0.0566? 2 0.00000 2 16667 3 ?000.00000 0 00000 Objective Allowable Allowable Variable Coefcient Increase Decrease S 8 00000 Innite 4 25000 M 3 00000 3 40000 Innite RHS Allowable Allowable Constraint Value Increase Decrease 1 1200000.00000 300000.00000 420000.00000 2 60000.00000 42000.00000 12000.00000 3 3000.00000 7000.00000 Innite \\ d. What is the rate of return for the portfolio