Develop the objective function

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Reference no: EM13848356

Financial Analysts, Inc., is an investment firm that manages stock portfolios for a number of clients. A new client is requesting that the firm handle an $80,000 portfolio. As an initial investment strategy, the client would like to restrict the portfolio to a mix of the following
two stocks:

Case Problem Scheduling a Golf League23

Maximum

Price/ Estimated Annual Possible

Stock Share Return/Share Investment

Oil Alaska $50 $6 $50,000

Southwest Petroleum $30 $4 $45,000

Let

x = number of shares of Oil Alaska

y = number of shares of Southwest Petroleum

a.Develop the objective function, assuming that the client desires to maximize the total annual return.

b.Show the mathematical expression for each of the following three constraints:

(1) Total investment funds available are $80,000.

(2) Maximum Oil Alaska investment is $50,000.

(3) Maximum Southwest Petroleum investment is $45,000.

Reference no: EM13848356

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