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Twelve thousand dollars are to be applied to a student’s educational expenses in the following way: Between $2,000 and $4,000 for books Between $3,000 and $6,000 for tuition Between $2,000 and $3,000 for tutors Between $1,000 and $4,000 for computer equipment The allocation is to be made in whole thousands of dollars for each category. His family has quantified the anticipated payoffs in terms of increased future annual earnings as follows: His mother has a BS degree in Industrial Engineering from a prestigious university in Pennsylvania. She believes the problem can be formulated as a BACKWARD DYNAMIC PROGRAMMING model to determine the optimal allocation of the $12,000.
Expert Answer
Answer
ON solving:
| Books | Tuitio | Tutos | Computer | Sum | |||
| 4 | 4 | 3 | 1 | 12 | = | 12 | |
| >= | >= | >= | >= | ||||
| 2 | 3 | 2 | 1 | ||||
| <= | <= | <= | <= | ||||
| 4 | 6 | 3 | 4 | ||||
| 5 | 8 | 4 | 4 | ||||
| 10 | 11 | 6 | 6 | ||||
| 11 | 14 | 10 | |||||
| 17 | 13 | ||||||
| Return | 11 | 11 | 6 | 4 | |||
| Total return | 2.666667 | ||||||
| Max |
