Your job is to maximize the yield of someone's stock portfolio. They want a minimum average return of 7% (0.07) to start. They have some concerns about variability too. Thou, initially, they are not that worried. You need to use the solver to answer the following questions.

Q1 (5pts) What is the optimal mix of stocks to maximize returns and what is the return?

Q2 (5 pts) How does setting the variability to 11% (0.11) affect the optimal mix and return?

Q3 (5 pts) How does setting the variability to 7% (0.07) affect the optimal mix and return?

Q4 (5 pts) Suppose that the client says they don't want to have more than 50% (0.50) of their stock in any 1 company. How does affect the optimal mix and return if the maximum variability cannot exceed 7%?

Q5 (5 pts) Of the 4 scenarios above, which would you choose and why? (2-3 sentences)

The customer came back and asked you to redo some of the calculations.

Q6 (5 pts) The customer wants a minimum return of 10% (0.10) and they do not want more than 50% of their stocks to be with one company. What are their stocks and what is their return?

Q7 (5 pts) They asked you to rerun your solver when they want a minimum of 10% returns, variability to be under 3%(0.03) and no more than 50% of their stocks in any one company. What are their returns and what does the stock portfolio looking like?

Q8 (15 pts) They asked you to rerun your solver when they want a minimum of 12% returns, variability to be under 3%(0.03) and no more than 25% of their stocks in any one company. If that is not possible, suggest a solution where you relax some of their constraints. Either way, what are their returns and what does the stock portfolio looking like?

What is your min return?

What is your Max variability?

What are your constraints for portfolio allocation?