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Practical Management Science

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Question

A firm has prepared the following binary integer program to evaluate a number of potential new capital projects.
The firm's goal is to maximize the net present value of their decision while not spending more than their currently
available capital.
Max 100x1 + 120x2 + 90x3 + 135x4
s.t. 150x1 + 200x2 + 225x3 + 175x4 ≤ 500 {Constraint 1}
X1 + x2 + x3 + x4 ≥ 2 {Constraint 2}
X2 + X4 ≤ 1 {Constraint 3}
X2 + X3 ≥ 1 {Constraint 4}
X1 =
X4 {Constraint 5}
{1, if projecte
ſ 1, if project j is selected
xj
=
Which constraint ensures that the firm will not spend more capital than it has available (assume that each potential
project has a different cost)?

Multiple Choice
O
O
O
Constraint 5
Constraint 4
Constraint 3
Constraint 1
Constraint 2

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