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Ivana Miracle wishes to invest up to her full inheritance of $580,000, and her goal is to minimize her risk subject to an expected annual return of...
Ivana Miracle wishes to invest up to her full inheritance of $580,000, and her goal is to minimize her risk subject to an expected annual return of at least $29,000. She has decided to invest her money in any of three possible ways — CDs, which pay a guaranteed 2 percent; stocks, which have an expected return of 5 percent; and a money market mutual fund, which is expected to return 3 percent. Risk factors are 1.5 for the CDs, 4.5 for the stocks, and 2.8 for the money market fund. What is the optimal solution and minimum risk value? Please attach the Excel file.
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