A firm has prepared the following binary integer program to evaluate a number of potential locations for new warehouses. The firm's goal is to maximize the net present value of their decision while not spending more than their currently available capital. Max 25x1 + 15x2 + 25x3+ 15x4 s.t. 5x1 + 11x2 + 4x3 +5x4 s 11 (Constraint 1) X1 + x2 + x3 + X4 2 2 (Constraint 2) X1 + x2 $ 1 (Constraint 3) X1 + x3 2 1 (Constraint 4) x2 = X4 {Constraint 5) S1, if locationjis selected 0, otherwise Solve this problem to optimality and answer the following questions: a. Which of the warehouse locations will/will not be selected? Location 1 will Location 2 will Location 3 will Location 4 will
A firm has prepared the following binary integer program to evaluate a number of potential locations for new warehouses. The firm's goal is to maximize the net present value of their decision while not spending more than their currently available capital. Max 25x1 + 15x2 + 25x3+ 15x4 s.t. 5x1 + 11x2 + 4x3 +5x4 s 11 (Constraint 1) X1 + x2 + x3 + X4 2 2 (Constraint 2) X1 + x2 $ 1 (Constraint 3) X1 + x3 2 1 (Constraint 4) x2 = X4 {Constraint 5) S1, if locationjis selected 0, otherwise Solve this problem to optimality and answer the following questions: a. Which of the warehouse locations will/will not be selected? Location 1 will Location 2 will Location 3 will Location 4 will
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
Transcribed Image Text:Skipped
b. What is the net present value of the optimal solution? (Round your answer to the nearest whole number.)
Net present value
c. How much of the available capital will be spent (Hint: Constraint 1 enforces the available capital limit)? (Round your answer to the
nearest whole number.)
Available capital
1.

Transcribed Image Text:1
A firm has prepared the following binary integer program to evaluate a number of potential locations for new warehouses. The firm's
goal is to maximize the net present value of their decision while not spending more than their currently available capital.
Max 25x1 + 15x2 + 25x3+ 15x4
s.t 5x1 + 11x2 + 4x3 + 5x4 $ 11 (Constraint 1)}
X1+x2
X1 + x2 Ś 1 {Constraint 3}
X1 +x3 2 1{Constraint 4)
X2 = x4 {Constraint 5}
X4 2 2 {Constraint 2)
+
+
X3
S1, if location jis selected
0, otherwise
Solve this problem to optimality and answer the following questions:
a. Which of the warehouse locations will/will not be selected?
Location 1 will
Location 2 will
Location 3 will
Location 4 will
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