25. George Johnson recently inherited a large sum of money; he wants to use a portion of this moneyto set up a trust fund for his two children. The trust fund has two investment options: (1) a bondfund and (2) a stock fund. The projected returns over the life of the investments are 6% for thebond fund and 10% for the stock fund. Whatever portion of the inheritance he finally decidesto commit to the trust fund, he wants to invest at least 30% of that amount in the bond fund. Inaddition, he wants to select a mix that will enable him to obtain a total return of at least 7.5%.a. Formulate a linear programming model that can be used to determine the percentagethat should be allocated to each of the possible investment alternatives.b. Solve the problem using the graphical solution procedure.

given, 6% for the bond fund 10% stock fund The total return of at least 7.5%

Answered: 5. George Johnson recently inherited a…

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...

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