PROBLEM 6 STOCK PORTFOLIO SELCTION TO MAXIMIZE ANNUAL RETURN

CLIENT CAN INVEST UP TO $3,000 BY SELECTING FROM THE FOLLOWING 7 STOCK CHOICES.
THESE INVESTMENTS ARE BINARY ; YES OR NO
QUESTION: SATISFY THE OBJECTIVE WHILE MEETING THE CONSTRAINTS LISTED.

NO. STOCK LOCATION ANNUAL RETURN COST

1 TRANS_TEXAS TEXAS $ 50.00 $ 480.00
2 BRITISH_PETRO FOREIGH $ 80.00 $ 540.00
3 DUTCH_SHELL FOREIGH $ 90.00 $ 680.00
4 HOUSTON_OIL TEXAS $ 120.00 $ 1,000.00
5 LONE_STAR_GAS TEXAS $ 110.00 $ 700.00
6 SAN_DIEGO_OIL CALIF $ 40.00 $ 510.00
7 CALIF_DRILL CALIF $ 75.00 $ 900.00

OBJECTIVE:
MAXIMIZE PORTFOLIO RETURN

CONSTRAINTS:
1) AT LEAST TWO TEXAS COMPANIES SELECTED
2) NO MORE THAN ONE FOREIGN SELECTED
3) MUST INCLUDE EXACTLY ONE OF THE TWO CALIF COMPANIES
4) IF BRITISH_PETRO SELECTED THEN TRANS_TEXAS MUST ALSO BE SELECTED
5) NO MORE THAN $3,000 CAN BE INVESTED

ANSWER:
SELECTION MAX
NO. STOCK LOCATION ANNUAL RETURN COST YES=1/NO=0 RETURN= $ 360.00
1 TRANS_TEXAS TEXAS $ 50.00 $ 480.00 0
2 BRITISH_PETRO FOREIGH $ 80.00 $ 540.00 0 CONSTRAINTS:
3 DUTCH_SHELL FOREIGH $ 90.00 $ 680.00 1 1) 2 >= 2
4 HOUSTON_OIL TEXAS $ 120.00 $ 1,000.00 1 2) 1 <= 1
5 LONE_STAR_GAS TEXAS $ 110.00 $ 700.00 1 3) 1 = 1
6 SAN_DIEGO_OIL CALIF $ 40.00 $ 510.00 1 4) 0 >= 0
7 CALIF_DRILL CALIF $ 75.00 $ 900.00 0 5) $ 2,890.00 <= $ 3,000.00