unit 5 and 6 - Copy.docx - Evaluation Sheet for Professor...

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Evaluation Sheet for Professor Use OnlyPART 1 (Individual Problem 5) 56 POINTSQuestion 1TOTALMarks16Your ScoreQuestion 220MarksYour ScoreQuestion 320MarksYour ScorePART 2 (Individual Problem 6 56 Points Question 1Marks16Your ScoreQuestion 220MarksYour ScoreQuestion 320MarksYour ScoreTotal
PART 1 Total Value: 56 pointsInstructionsThese problems focus on finding solutions to numerical problems. With that in mind, most problem sets will include a number of problems. For each problem, you will need to provide more than a simple numerical response. Your solutions should thoroughly address the issue and present your findings in a meaningful format,similar to those developed within the chapters and as part of the review exercises solutions. Any Excel spreadsheet models developed to solve the problems should be included with your submission. Part value may be assigned for incorrect responses. Question 1: The NEC Company produces two cheese spreads by blending mild cheddar cheese with extra sharp cheddar cheese. The cheese spreads are packaged in 12-ounce containers, which are then sold to distributors throughout the Northeast. The Regular blend contains 80% mild cheddar and 20% extra sharp, and the Zesty blend contains 60% mild cheddar and 40% extra sharp. This year,a local dairy cooperative offered to provide up to 8100 pounds of mild cheddar cheese for $1.20 per pound and up to 3000 pounds of extra sharp cheddar cheese for $1.40 per pound. The cost to blend and package the cheese spreads, excluding the cost of the cheese, is $0.20 per container. If each container of Regular is sold for $1.95 and each container of Zesty is sold for $2.20, how many containers of Regular and Zesty should NEC produce?
Question 2: The Glorious Company manages approximately $15 million for clients. For each client, Gloria chooses a mix of three investment vehicles: a growth stock fund, an income fund, and a money market fund. Each client has different investment objectives and different tolerances for risk. To accommodate these differences, Gloria places limits on the percentage of each portfolio that maybe invested in the three funds and assigns a portfolio risk index to each client. Here’s how the system works for Dennis Hartmann, one of Gloria’s clients. Based on an evaluation of Hartmann’s risk tolerance, Gloria has assigned Hartmann’s portfolio a risk index of 0.05. Furthermore, to maintain diversity, the fraction of Hartmann’s portfolio invested in the growth and income funds must be at least 10% for each, and at least 20% must be in the money market fund. The risk ratings for the growth, income, and money market funds are 0.10, 0.05, and 0.01, respectively. A portfolio risk index is computed as a weighted average of the risk ratings for the

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