Problem:
A business executive has the option of investing money in two plans. Plan A guarantees that each dollar invested will warn 70 cent a year hence, plan B guarantees that each dollar invested will earn $2.00 two years hence. In plan B, only investments that are multiple of 2 years are allowed. How should the executive invest $100,000 to maximize the earnings at the end of year3?
Required:
Question: Formulate the problem as a linear programming model?
Note: Provide support for your underlying principle.