Fox Enterprises is considering six projects for possible construction over the next four ycars. Fox can undertake any of the projects partially or completely. A partial undertaking of a project will prorate both the return and cash outlays proportionatel; The expected (present value) returns and cash outlays for the projects are given in th following table. Cash outlay ($1000) Project Year ! Year 2 Year 3 Year 4 Return ($1000) 10.5 14.4 2.2 2.4 324.00 8.3 12.6 9.5 3.1 358,00 10.2 14.2 5.6 4.2 177.50 4 7.2 10.5 7.5 5.0 148,00 12.3 10.1 8.3 6.9 6.3 182.00 9.2 7.8 5.1 123.50 Available funds ($1000) 60.0 70.0 35.0 20.0 (a) Formulate the problem as a linear program, and determine the optimal project mix that maximizes the total return using AMPL, Solver, or TORA. Ignore the time value of money. (b) Suppose that if a portion of project 2 is undertaken, then at least an equal portion of project 6 must be undertaken. Modify the formulation of the model, and find the new optimal solution. (c) In the original model, suppose that any funds left at the end of a year are used in the next year. Find the new optimal solution, and determine how much cach ycar "borrows" from the preceding year. For simplicity, ignore the time value of money.

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter9: Decision Making Under Uncertainty
Section: Chapter Questions
Problem 30P
icon
Related questions
Question

please answer the following question a , b, c, d using execl solver ?

Fox Enterprises is considering six projects for possible construction over the next
four ycars. Fox can undertake any of the projects partially or completely. A partial
undertaking of a project will prorate both the return and cash outlays proportionatel;
The expected (present value) returns and cash outlays for the projects are given in th
following table.
Cash outlay ($1000)
Project
Year !
Year 2
Year 3
Year 4
Return ($1000)
10.5
14.4
2.2
2.4
324.00
8.3
12.6
9.5
3.1
358,00
10.2
14.2
5.6
4.2
177.50
4
7.2
10.5
7.5
5.0
148,00
12.3
10.1
8.3
6.9
6.3
182.00
9.2
7.8
5.1
123.50
Available funds ($1000)
60.0
70.0
35.0
20.0
(a) Formulate the problem as a linear program, and determine the optimal project mix
that maximizes the total return using AMPL, Solver, or TORA. Ignore the time
value of money.
(b) Suppose that if a portion of project 2 is undertaken, then at least an equal portion
of project 6 must be undertaken. Modify the formulation of the model, and find the
new optimal solution.
(c) In the original model, suppose that any funds left at the end of a year are used in
the next year. Find the new optimal solution, and determine how much cach ycar
"borrows" from the preceding year. For simplicity, ignore the time value of money.
Transcribed Image Text:Fox Enterprises is considering six projects for possible construction over the next four ycars. Fox can undertake any of the projects partially or completely. A partial undertaking of a project will prorate both the return and cash outlays proportionatel; The expected (present value) returns and cash outlays for the projects are given in th following table. Cash outlay ($1000) Project Year ! Year 2 Year 3 Year 4 Return ($1000) 10.5 14.4 2.2 2.4 324.00 8.3 12.6 9.5 3.1 358,00 10.2 14.2 5.6 4.2 177.50 4 7.2 10.5 7.5 5.0 148,00 12.3 10.1 8.3 6.9 6.3 182.00 9.2 7.8 5.1 123.50 Available funds ($1000) 60.0 70.0 35.0 20.0 (a) Formulate the problem as a linear program, and determine the optimal project mix that maximizes the total return using AMPL, Solver, or TORA. Ignore the time value of money. (b) Suppose that if a portion of project 2 is undertaken, then at least an equal portion of project 6 must be undertaken. Modify the formulation of the model, and find the new optimal solution. (c) In the original model, suppose that any funds left at the end of a year are used in the next year. Find the new optimal solution, and determine how much cach ycar "borrows" from the preceding year. For simplicity, ignore the time value of money.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps with 6 images

Blurred answer
Knowledge Booster
Optimization models
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Practical Management Science
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,