Application of Linear Programming: TradeCo Investment and Production Scheduling

TradeCo Investment

Question 1This question is about the application of Linear Programming (LP). Parts (a)and (b)are in a company setting, and part (c)is in your daily life setting.

(a)TradeCo wants to invest at most $10,000 in 2021. Two investmentoptionsare proposed: STKand BD, with annual yields of 20% and 10% respectively. Based on market research, TradeCo wishes to limit the amount invested in STKto no more than 60% of the total investment. How should TradeCo investto generate the highest annual yield?Develop an LP model that represents the problem. Pleaseclearly statedecision variables, objective and constraints. You do notneed to solve it.Please limit the answer to within one page.(

(b)Suppose thatTradeCo imposes one more restriction:investment in BDshould be at leasttimes the investment in STKwhere is a non-negative constant. Find the optimal solution to the problem and discuss how the value ofwould affect TradeCo’s best investment decisionand annual yield. Please limit the answer to within two pages

(c)Identify one(1)application of LP in production scheduling, plant layout, or logistics. Please describe the problem and explain why LP is suitable for solving theproblem.Youdo notneed toformulate the problem as an LP orsolve it.