Diversifying the investments and lessening the risk

Assignment Help Business Management
Reference no: EM132796483

1. PT. PLN has $140000 to invest. The alternative investments and the corresponding annual returns are SUN (8.5%), CDs (5%), T-bills (6,5%) and stocks (13%). PT PLN wants to maximize the investment return.

The following guidelines have been established for diversifying the investments and lessening the risk :

A. No more than 30% of total investment should be in SUN

B. The amount invested in the CDs should not exceed the amount in the other 3 alternatives

C. At least 40% of the investment should be in T-bills and CDs

D. To be safe, more should be invested in CDs and T-bills than in SUN and the stocks, by a ratio a least 1,2 to 1.

Formulate the LP model for PT. PLN in excel.

Reference no: EM132796483

Questions Cloud

Complete a transactions for Dec : Of the bank loan, $1,000,000 is due June 30, 2021 with the remainder due June 30, 2026. Complete a transactions for Dec 31, 2020
Compute bread-even sales in units and in rupees : Compute Bread-even Sales in units and in Rupees. A Company annually manufactures and sells 20,000 units of product, the selling price of which is Rs.50
Prepare a schedule of cash flows for the project : Prepare a schedule of cash flows for the project. Calculate, using the information available, the Net Present Value of the proposal to sell online shopping
What is the value of coaching and mentoring new employees : What is the value of coaching and mentoring new employees? What steps and/or programs do you recommend for new employees to help them optimize their performance
Diversifying the investments and lessening the risk : 1. PT. PLN has $140000 to invest. The alternative investments and the corresponding annual returns are SUN (8.5%), CDs (5%), T-bills (6,5%) and stocks (13%). PT
Prepare the entries on each of the three dates : On January 1, Blue Spruce Corp. had 63,300 shares of no-par common stock issued and outstanding. Prepare the entries on each of the three dates
What would the basis of the property be to mary heir : If Mary's heir sold the property six months after she died for $57,000, what would be the heir's holding period and recognized gain (or loss)?
Describe range of psychometric tests using by organizations : Describe a range of psychometric tests using by organizations, and how their uses, give some examples.
What is mary holding period in the asset : What is the recognized gain or loss if the taxpayer later sells the property for $30,000 or $55,000? What is Mary's holding period in the asset?

Reviews

Write a Review

Business Management Questions & Answers

  Define joe problem

a. Define Joe's problem. b. What are the resources of potential conflict in this situation?

  Describe the components of effective communication

Describe the components of effective communication and how do effective communication skills enhance manager-employee relations? Provide examples to support your answer.

  Determine the discounted cash flow

Determine the Discounted Cash Flow (DCF) value of the firm.

  Describe the business-level strategy of victory motorcycles

Evaluate the business-level strategy of Victory Motorcycles to determine whether you believe the strategy is appropriate to offset forces in the industry.

  Adjusting lower cost market inventory on valuation

As a newly hired Staff I, you are for analyzing the work papers for one the clients of your organization. Your client not clear about why you are for information on the following topics:

  General description that includes a brief history

Company name  (Starbucks) and general description that includes a brief history. A brief overview of their products and/or services and how they meet the needs of customers.

  Explain board of directors annual meeting date.

Create a fictitious organization for which you answer all the questions and tasks in the weekly assignments. Explain Board of Directors annual meeting date.

  Causal and a correlational relationship

What is the Different between a causal and a correlational relationship.

  Why is multi-collinearity not a problem in simple regression

(a) Why is multi-collinearity not a problem in simple regression?

  Growth rate to infinity of a cash flow

Can the growth rate to infinity of a cash flow be higher than the discount rate? Why?

  Predict trends in current gdp growth

Based on macroeconomic data, predict trends in current GDP growth, inflation, and interest rates. Do you think policies have been effective?

  How can your organization apply steps to manage a project

What is the four-step process of innovation and learning and how can your organization apply these steps to manage a project? Of the five levels of an organizational project management maturity model.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd