The linear programming formulation that will maximize the total annual return of the portfolio is as follows.

Max $3U+5H$ Maximize total annual return

$s.t.$

$25U+50H80,000$ Funds available

$0\mathrm{.}50U+0\mathrm{.}25H700$ Risk maximum

$1U,1,000U.S.$ Oil maximum

$U,H0,$

The computer output is shown below.

$\backslash$table$[[$Variable$,$Value,Reduced Cost$],[0,800,00000,0\mathrm{.}00000],[$H$,1200\mathrm{.}00000,0\mathrm{.}00000],[$Constraint$,$Slack$/$Suxplus$,$Dual Value$],[1,0\mathrm{.}00000,0\mathrm{.}09333],[2,\backslash$table$[[0\mathrm{.}00000],[200,00000]],1\mathrm{.}33333],[3,0\mathrm{.}00000],[$Variable$,\backslash$table$[[$Objective$],[$Coefflcient$]],\backslash$table$[[$Allowable$],[$Increase$]],\backslash$table$[[$Allowable$],[$Decrease$]]],[$v$,3\mathrm{.}00000,7\mathrm{.}00000,0\mathrm{.}50000],[$H$,+5\mathrm{.}00000,1\mathrm{.}00000,3\mathrm{.}50000],[$Constraint$,\backslash$table$[[$RHS$],[$Value$]],\backslash$table$[[$Allowable$],[$Increase$]],\backslash$table$[[$Allowable$],[$Decrease$]]],[1,80000\mathrm{.}00000,60000\mathrm{.}00000,15000\mathrm{.}00000],[2,700,00000,75\mathrm{.}00000,300\mathrm{.}00000],[3,1000\mathrm{.}00000,$Infinite,$200,00000]]$