Blair & Rosen, Inc. (B&R) is a brokerage firm that specializes in investment portfolios designed to meet the specific risk…
Blair & Rosen, Inc. (B&R) is a brokerage established that specializes in cannonade portfolios prepared to engage the local imperil tolerances of its clients. A client who contacted B&R this spent week has a culmination of $50,000 to endue. B&R’s cannonade advisor decides to praise a portfolio consisting of two cannonade capitals: an Internet capital and a Blue Chip capital. The Internet capital has a contemplated annual recur of 12 percent, and the Blue Chip capital has a contemplated annual recur of 9 percent. The cannonade advisor requires that at most $35,000 of the client’s capitals should be endueed in the Internet capital. B&R services comprise a imperil rating for each cannonade resource. The Internet capital, which is the more imperily of the two cannonade resources, has a imperil rating of 6 per $1,000 endueed. The Blue Chip capital has a imperil rating of 4 per $1,000 endueed. For specimen, if $10,000 is endueed in each of the two cannonade capitals, B&R’s imperil rating for the portfolio would be 6(10) 1 4(10) 5 100. Finally, B&R patent clear a questionnaire to gauge each client’s imperil tolerance. Based on the responses, each client is classified as a undestroyed, sparing, or unsavory endueor. Suppose that the questionnaire results classified the currentclient as a sparing endueor. B&R praises that a client who is a sparing endueor condition his or her portfolio to a culmination imperil rating of 240.
a. Formulate a straight programming standard to furnish the best cannonade manoeuvre for this client.
b. Build a spreadsheet standard and explain the amount using Solver. What is the praiseed cannonade portfolio for this client? What is the annual recur for the portfolio?