The Graphical Method - Optimal Solution Previous Next
Optimal Solution:
Optimal point on graph: (0, 7)

Resulting optimal solution: 

Optimal value of 

Remember that  and  represent Leo's number of shares of Ventures 1 and 2 respectively. Also,  is measured in units of thousands of dollars. Therefore, our conclusion is that Leo should take 7 shares of Venture 2, but none of Venture 1. This strategy will enable Leo to add $70,000 dollars to his savings before returning to school to earn an MBA degree.
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