Solved: Integer Programming You are given a group of possible investment projects for your company's

Part 4. Integer Programming 120 points) 1. You are given a group of possible investment projects for your companys capital. For each project, you are given the NPV the project would add to the firm, as well as the cash outflow required by each project during each year. Given the information in the file P06 40.xls, determine the investments that maximize the firms NPV-The firm has S30 million available during each of the next 5 years. All numbers are in millions of dollars. Cash outflows in various years, NPV of projects Project Project Project Project Project Project Project Project Project Project Project Project 1 2 3 4 5 6 789 10 11 12 Year 1 1 $3 S4 $6 $5 $4 $2 $0 $1 $3 $9 $8 Year 2 $3 54 $4 $5 $1 $5 $3 $0 $1 $2 $2 57 Year 3 S4 $2 $3 $3 $2 $2 $1 $3 $4 $4 $4 $1 Year 4 $1 $1 $2 $2 $3 $5 $4 $6 $8 $1 $1 S1 Year 5 $1 $2 1 $3 58 $5 $6 $7 $3 $6 $1 $1 $20 $25 $30 S35 $40 $42 $31 $33 $15$37 S38 $39 NPV

Integer Programming You are given a group of possible investment projects for your company’s capital. For each project, you are given the NPV the project would add to the firm, as well as the cash outflow required by each project during each year. Given the information in the file P06_40.xls, determine the investments that maximize the firm’s NPV. The firm has $30 million available during each of the next 5 years. All numbers are in millions of dollars.

Expert Answer

Solving using EXCEL Solver based linear optimization:

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