Fund 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Risk High High High High High High Medium Medium Medium Medium Medium Low Low Low Low Low Low Type Stock Stock Stock Stock Stock Stock Blend Blend Blend Blend Blend Blend Bond Bond Bond Bond Return 11.98% 13.18% 9.40% 7.71% 8.35% 16.38% 4.10% 12.52% 8.62% 11.14% 8.78% 9.44% 8.38% 7.65% 6.90% 5.53% 6.30% His financial advisor has suggested that at most 40% of the portfolio should be composed of high-risk funds. At least 25% should be invested in bond funds, and at most 40% can be invested in any single fund. At least six funds should be selected, and if a fund is selected, it should be funded with at least 5% of the total contribution. Develop and solve an integer optimization model to determine which funds should be selected and what percentage of his total investment should be allocated to each fund.
Fund 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Risk High High High High High High Medium Medium Medium Medium Medium Low Low Low Low Low Low Type Stock Stock Stock Stock Stock Stock Blend Blend Blend Blend Blend Blend Bond Bond Bond Bond Return 11.98% 13.18% 9.40% 7.71% 8.35% 16.38% 4.10% 12.52% 8.62% 11.14% 8.78% 9.44% 8.38% 7.65% 6.90% 5.53% 6.30% His financial advisor has suggested that at most 40% of the portfolio should be composed of high-risk funds. At least 25% should be invested in bond funds, and at most 40% can be invested in any single fund. At least six funds should be selected, and if a fund is selected, it should be funded with at least 5% of the total contribution. Develop and solve an integer optimization model to determine which funds should be selected and what percentage of his total investment should be allocated to each fund.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
Related questions
Question
Transcribed Image Text:Fund
1
2
3
4
5
6
7
CO
8
9
10
1231
11
12
13
14
15
16
17
Risk
High
High
High
High
High
High
Medium
Medium
Medium
Medium
Medium
Low
Low
Low
Low
Low
Low
Туре
Stock
Stock
Stock
Stock
Stock
Stock
Blend
Blend
Blend
Blend
Blend
Blend
Blend
Bond
Bond
Bond
Bond
Return
11.98%
13.18%
9.40%
7.71%
8.35%
16.38%
4.10%
12.52%
8.62%
11.14%
8.78%
9.44%
8.38%
7.65%
6.90%
5.53%
6.30%
His financial advisor has suggested that at most 40% of
the portfolio should be composed of high-risk funds. At
least 25% should be invested in bond funds, and at most
40% can be invested in any single fund. At least six funds
should be selected, and if a fund is selected, it should be
funded with at least 5% of the total contribution.
Develop and solve an integer optimization
model to determine which funds should be selected
and what percentage of his total investment should
be allocated to each fund.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps with 2 images
Recommended textbooks for you
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.