I have a similar problemWorried)
Bond A: 9.5% return/long maturity/high risk/tax free yes
Bond B: 8.0/short/low/yes
Bond C: 9.0/long/low/no
Bond D: 9.0/long/high/yes
Bond E: 9.0/short/high/no
AT LEAST 50% of money must be in short-term
NO MORE THAN 50% in high risk
AT LEAST 30% should be tax free
AT LEAST 40% of total annual return should be tax free
Maximize ROI: How much should be invested in each bond?
Here's what I have so far:
Max ROI: .095A+.08B+.09C+.09D+.09E
a+b+c+d+e = 100,000
Short term: B+E greaten than or equal to 50,000
High Risk: A+D+E less than equal to 50,000
Tax Free: A+B+D greater than equal to 30,000
40% tax free return: .40(A+B+C+D+E greater than equal to A+B+D
Is this right so far??? Especially the 40% tax free return part???
I don't understand how to input this into excel solver to get the answer and sensitivity report????? I copied my excel below ... hopefully it shows up on the post...
Your help is greatly appreciated!!!!!
Bond A
Bond B
Bond C
Bond D
Bond E
Return Quantity 0 0 0 0 0
0
Rates of Return 0.095 0.08 0.09 0.09 0.09
Bond A - X1 1 0 0 0 0
Bond B - X2 0 1 0 0 0
Bond C - X3 0 0 1 0 0
Bond D - X4 0 0 0 1 0
Bond E - X5 0 0 0 0 1
Short Term 0 1 0 0 1
High Risk 1 0 0 1 1
Tax Free Inv. 1 1 0 1 0
Total 1 1 1 1 1