Consider the following problem: Joe, a (CFP), has been asked by a client to invest $750,000. This money may be used to create a portfolio in stocks, bonds, or mutual fund in real estate. The expected return on investment is 15% for stocks, 8% for bonds, and 12% for real estate. While the client would like a very high expected return, she would be satisfied with a 10% expected return on her money. Due to risk considerations, several goals have been established to keep the risk at an acceptable level. One goal is to put at least 25% of the money in bonds. Another goal is that the amount of money in real estate should not exceed 40% of the money invested in stocks and bonds combined. Furthermore, avoid surpassing $250,000 investment limit while financing stocks. After a thorough discussion, the client informed Joe that all goals are of equal importance. The Goal objective function is written as Maximize G = 2(d1-) + 3(d2+) + (d3-) + (d4-) = Minimize G = (d1-) + (d2-) + (d3+) + (d4+) = None of the answers. Maximize G = (d1+) + (d2-) + (d3+) + (d4+) Minimize G = 3(d1-) + 2(d2) + (d3-) + (04-) The first goal constrain "Expected Return on Money invested" is written as * None of the answers. 0.05x1 - 2x2 + 0.02x3 + (d1-) -(d1+) = 0 - 0.05x1 -0.02x2 + 0.02x3 + (d1-) - (d1+) = 0 = 0.05x1 -0.02x2 + 0.02x3 + (d1-) + (d1+) = 0 O 5x1 -0.02X2 + 0.02x3 + (d1-) - (d1+) = 0 == The second goal constrain "put at least 25% of the money in bonds" is written as 0.25x1 -0.75x2 + 0.25x3 + (d2-) - (d2+) = 0 = 2.5x1 - 0.75x2 + 0.25x3 + (d2-) - (d2+) = 0 = None of the answers. - 0.025x1 -0.75x2 +0.25x3 + (d2-)-(d2+) = 0 0.025x1 - 7.5x2 + 0.25x3 + (d2-) - (d2+) = 0 The third goal constraint "the amount of money invested in real estate" is written as: * 0.4x1 + 0.4x2 - x3 + (d3-) - (d3+) = 0 = 4x1 + 0.4x2 - x3 + (d3-) - (d3+) = 0 = 04x1 + 0.4x2 - x3 + (d3-) - (d3+) = 0 40x1 + 0.4x2 - x3 + (03-) - (d3+) = 0 O None of the answers. The fourth goal constraint: "Financing limit for stocks." is written as None of the answers. x1 + (04-) - (d4+) = 250,000 = x1 + (d4-) + (d4+) = 25,000 = O 2x1 + (d4-) + (d4+) = 250,000 = O x1 + (d4+) + (d4+) = 250,000 = 1