You are the CFO of ABC Investment. You have been tasked by your CEO to determine what percentage of your firm's investable funds to place in each of three potential investment opportunities:

Investment A expected yield=10.0% Risk rating=5

Investment B expected yield=7.5% risk rating=2

investment C expected yield=9.0% risk rating=4

The expected yield represents each investment's expected annual yield.

the risk rating indicates an independent financial analysts' assessment of each investment's risk, with higher ratings indicating a higher level of risk associated with an investment.

You have been given two objectives:

(1) Maximize the weighted average yield of the funds placed in these investments

(2) Minimize the weighted average risk of the funds placed in these investments

The company has allocated a total of $5,000,000 to be invested in these three investments. Your CEO has also indicated that all investable funds should be allocated to these three investment opportunities.

1. Formulate the final mathematical MOLP model for this problem.
2. Implement your model in a spreadsheet.

(i)There are two objectives in this problem - (i) to maximize the weighted average yield and (ii) to minimize the weighted average risk. What is the best possible value attainable for each objective in the problem?

(ii)Suppose you consider maximizing the weighted average yield as being twice as important as minimizing the weighted average risk. What solution does this suggest?