Formulate a linear program to maximize the return

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Question - We are going to manage an investment portfolio over a 6-year time horizon. We begin with $1000, and at various times we can invest in one or more of the following:

Savings account X, annual yield 5%.

Security Y, 2-year maturity, total yield 12% if bought now, 11% thereafter.

Security Z, 3-year maturity, total yield 18%.

Security W, 4-year maturity, total yield 24%. To keep things simple we will assume that each security can be bought in any denomination. We can make savings deposits or withdrawals anytime. We can buy Security Y any year but year 3. We can buy Security Z anytime after the first year. Security W, now available, is a one-time opportunity. Formulate a linear program to maximize the return?

Reference no: EM133106902

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