Open Journal of Modelling and Simulation

Volume 4, Issue 2 (April 2016)

ISSN Print: 2327-4018   ISSN Online: 2327-4026

Google-based Impact Factor: 0.84  Citations  

The Optimal Investment Strategy Based on the DEA Model

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DOI: 10.4236/ojmsi.2016.42006    1,671 Downloads   2,140 Views  

ABSTRACT

The Goodgrant Foundation is a charitable organization that wants to improve education performance of undergraduates attending colleges and universities in the US. So the foundation plans to contribute a total of US 50 million for a suitable team of schools per year under the condition of avoiding repeated other large grant organizations’ investment. The DEA (Data Estimate Analysis) model is developed to determine an optimal investment strategy for the Goodgrant Foundation. In this paper, two questions were solved: how to choose a suitable team of schools and how to allocate the investment. Before the establishment of the model, the EXCEL software is used to preprocess data. Then the DEA model which includes two models in the paper is developed. For the first question, the CCR model is established to rank schools which used efficiency from DEAP 2.1. For the second question, the resource allocation model is established to allocate investment amount by weights of allocation from MATLAB software. Accordingly, the optimal investment strategy is received for the Goodgrant Foundation. Through the analysis above, 23 from 293 schools are selected to invest. Then the schools are ranked and the investment of US 50 million for 23 schools is allocated.

Cite this paper

Zhang, Y. , Zhang, S. , Zhang, X. and Li, Z. (2016) The Optimal Investment Strategy Based on the DEA Model. Open Journal of Modelling and Simulation, 4, 46-54. doi: 10.4236/ojmsi.2016.42006.

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