Stocks in the hope of maximizing return on his investment

Assignment Help Financial Management

Reference no: EM131866146

Use the simplex method to solve the following linear programming problems

Mr. Moody has decided to invest at most N$100 000 in securities in the form of corporate stocks. He has classified his options into three groups of stocks: blue-chip stocks that he assumes will yield a 10% return on his investment within a year, growth stocks that he assumes will yield a 15% return on his investment within a year, and speculative stocks that he assumes will yield 20% return on his investment within a year. Because of the relative risks involved in his investment, he has further decided that no more than 30% of his investment should be in growth and speculative stocks and at least 50% of his investment should be in blue chip and speculative stocks.

Determine how much Mr. Moody should invest in each class of stocks in the hope of maximizing the return on his investments.

Reference no: EM131866146

Questions Cloud

How many bottles must be sold to break even : Suppose that marketing executives for Touché Toiletries reduced the price to $6.50 for a three-ounce bottle of Ode d'Toade and the fixed costs were $1,100,000.

Responsible for growth : Of all the BMP's discovered, which one do you think are more likely to be responsible for growth? Why?

List two pricing objectives and three pricing constraints : List two pricing objectives and three pricing constraints. Think about your customers and competitors and set three possible prices.

Describe what some of the medical liability reform : Describe what some of the medical liability reform initiatives are that have been reported in Florida.

Stocks in the hope of maximizing return on his investment : Determine how much Mr. Moody should invest in each class of stocks in the hope of maximizing the return on his investments.

Dividend discount model and free cash flow to equity model : A major difference between the dividend discount model (DDM) and the free cash flow to equity model (FCFE) is that the FCFE :

Similarities between skimming pricing and prestige pricing : What are some similarities and differences between skimming pricing, prestige pricing, and above-market pricing?

Does medicaids medically needy category make sense to you : Does Medicaid's medically needy category make sense to you? Why or why not?

What is dividend discount model : What is a Dividend Discount Model? When to use it and how to apply it?

User Account

All Pages