Student Investment problems for linear Programming

[Ryu]

A student has inherited 100 thousand dollars which she would like to invest in a combination of two managed investments, denoted A and B, with the maximum amount allowed in each investment equal to 75 thousand dollars. Investment A has a rate of return of 5% per year while Investment B has a rate of return of 10% per year. An independent agency has assessed Investment A to have a risk rating of 4 (on a scale from 0 to 10) and Investment B to have a risk rating of 9 (i.e. risky). The student will not accept an average rate of return of less than 6% per year (i.e. the student will not accept an annual return less than 0.06 times the total amount invested) and she will not accept an average risk rating above 6. The student’s aim is to maximise the annual return from her investment.

Construct a linear programming model for this problem.

 

[mmm4444bot]

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[Denis]

Are you familiar with the basics? As example:
$75000 is invested for 5 years at rate of 5% APR compounded monthly.
What is the value at end of 5 years?