Question
The Heinlein and Krampf Brokerage firm has just been instructed by one of its clients to invest $250,000 of her money obtained recently through the
The Heinlein and Krampf Brokerage firm has just been instructed by one of its clients to invest $250,000 of her money obtained recently through the sale of land holdings in Ohio. The client has a good deal of trust in the investment house, but she also has her own ideas about the distribution of the funds being invested. In particular, she requests that the firm select whatever stocks and bonds they believe are well rated, but within the following guidelines:
(a) Municipal bonds should constitute at least 20% of the investment.
(b) At least 40% of the funds should be placed in a combination of electronic firms, aerospace firms, and drug manufacturers.
The clients goal is to maximize projected return on investments. The analysts, prepare a list of high-quality stocks and bonds and their corresponding rates of return:
Formulate this portfolio selection problem using LP.
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