Ivana Miracle Wishes to Invest Her Full Inheritance of $300,000

Essay

Ivana Miracle wishes to invest her full inheritance of $300,000, and her goal is to minimize her risk subject to an expected annual return of at least $30,000. She has decided to invest her money in any of three possible ways-CDs, which pay a guaranteed 6 percent; stocks, which have an expected return of 15 percent; and a money market mutual fund, which is expected to return 8 percent. Risk factors are 1.0 for the CDs, 3.6 for the stocks, and 1.8 for the money market fund. Formulate this as a linear program.