How do you formulate this as a goal programming problem
asked by a client to invest $250,000. This money may be placed in stocks,
bonds, or a mutual fund in real estate. The expected return on investment is
13% for stocks, 8% for bonds, and 10% for real estate.
like a very high expected return, she would be satisfied with a 10% expected
return on her money. Due to risk considerations, several goals have been established
to keep the risk at an acceptable level. One goal is to put at least 30% of the
money in bonds.
not exceed 50% of the money invested in stocks and bonds combined. In addition
to these goals, there is one absolute restriction. Under no circumstances
should more than $150,000 be invested in any one area.
How do you formulate this as a goal programming problem?
Assume that all of the goals are equally important.
Categories: