The company's board of directors decided that the investment in bonds should not be less than 60%, and 25% is allotted for investment. 4 North Bank shares, and the board of directors decided that the investment in the shares of the Isra Company should not exceed 15%. Required: Formulate a linear programming model for this problem.

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter4: Linear Programming Models
Section: Chapter Questions
Problem 84P
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4. Malak Securities, a Jordanian investment company that owns (400,000) dinars2
whose account is with one of the banks in Jordan. Mr. Khaled Walid, the company's
general manager, wants to reinvest the mentioned amount in a financial portfolio that
can achieve the company the highest return on investment, and at the same time
create a mix A "preemptive" investment from stocks and bonds. The following table
shows the possible investment opportunities and the rate of return from each
investment opportunity:
Investment opportunity
Rate of return
Government bonds
.095
Al-Israa company shares
.146
North Bank shares
.075
Local bonds
.070
The company's board of directors decided that the investment in bonds should not
be less than 60%, and 25% is allotted for investment. 4 North Bank shares, and the
board of directors decided that the investment in the shares of the Isra Company
should not exceed 15%. Required: Formulate a linear programming model for this
problem.
Transcribed Image Text:4. Malak Securities, a Jordanian investment company that owns (400,000) dinars2 whose account is with one of the banks in Jordan. Mr. Khaled Walid, the company's general manager, wants to reinvest the mentioned amount in a financial portfolio that can achieve the company the highest return on investment, and at the same time create a mix A "preemptive" investment from stocks and bonds. The following table shows the possible investment opportunities and the rate of return from each investment opportunity: Investment opportunity Rate of return Government bonds .095 Al-Israa company shares .146 North Bank shares .075 Local bonds .070 The company's board of directors decided that the investment in bonds should not be less than 60%, and 25% is allotted for investment. 4 North Bank shares, and the board of directors decided that the investment in the shares of the Isra Company should not exceed 15%. Required: Formulate a linear programming model for this problem.
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