a. Which of the warehouse locations will/will not be selected?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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![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 30x₁ + 30x₂ + 25x3+ 35x4
s.t. 10x₁ + 12x₂ + 5x3 + 13x4 ≤ 15 [Constraint 1]
x3 + x4 2 2 [Constraint 2}
x1 + x2
+
x₁ + x₂ = 1 {Constraint 3}
x₁ + x3 2 1 [Constraint 4)
x₂ = x4 [Constraint 5)
=
J1, if location j is selected
xj
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
be selected
not be selected
be selected
not be selected](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6dfdbb25-81e7-44a9-8bf7-2a078f52c7cd%2Ff7ab8485-58df-41da-8252-ade089be7e38%2Fbza8ij6_processed.png&w=3840&q=75)
Transcribed Image Text: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 30x₁ + 30x₂ + 25x3+ 35x4
s.t. 10x₁ + 12x₂ + 5x3 + 13x4 ≤ 15 [Constraint 1]
x3 + x4 2 2 [Constraint 2}
x1 + x2
+
x₁ + x₂ = 1 {Constraint 3}
x₁ + x3 2 1 [Constraint 4)
x₂ = x4 [Constraint 5)
=
J1, if location j is selected
xj
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
be selected
not be selected
be selected
not be selected
Transcribed Image Text: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
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