Linear programming model for investment problem in maximizing the total return

• Main Authors: Syarifah Zyurina, Nordin, Farhana, Johar, Noratikah, Abu
• Format: Conference or Workshop Item
• Language: English
• Published: IOP Publishing Ltd 2021
• Subjects: Q Science (General); QA Mathematics
• Online Access: http://umpir.ump.edu.my/id/eprint/37385/1/Linear%20programming%20model%20for%20investment%20problem%20in%20maximizing%20the%20total%20return.pdf; http://umpir.ump.edu.my/id/eprint/37385/; https://doi.org/10.1088/1742-6596/1988/1/012064

In this paper, we concentrate on the investment problem of fixed deposit (FD). Our problem is to allocate the amount invested to a suitable tenure and obtain the optimal investment. There are two types of maturity that need to be considered which are short-term and long-term. Our objective is to maximize the total return of the total amount invested with a different percentage of annual return. A linear programming (LP) model is proposed to solve this investment problem using scheduling methodology. We conduct a computational experiment of a real case study for one company located in Kuala Lumpur with RM 20.6 million of investment to see the performance of the model by using the Excel Solver Parameter package. The results show that a significant improvement obtains by our model compared to the original investment practice by the company.