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6 - Part III - Integer Programming Example Solution(2)

The report presents an analysis of an investment project using Microsoft Excel, detailing the target cell for maximum NPV and the values of adjustable cells. It outlines the capital required for each year across multiple projects, indicating which projects are selected for investment. The total NPV calculated for the selected projects is $804, with various constraints and binding statuses noted.

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0% found this document useful (0 votes)
17 views2 pages

6 - Part III - Integer Programming Example Solution(2)

The report presents an analysis of an investment project using Microsoft Excel, detailing the target cell for maximum NPV and the values of adjustable cells. It outlines the capital required for each year across multiple projects, indicating which projects are selected for investment. The total NPV calculated for the selected projects is $804, with various constraints and binding statuses noted.

Uploaded by

najumobi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Microsoft Excel 12.

0 Answer Report
Worksheet: [iTech Shell.xlsx]Sheet1
Report Created: 11/2/2008 7:54:08 PM

Target Cell (Max)


Cell Name Original Value Final Value
$D$16 Total NPV Year 1 $804 $804

Adjustable Cells
Cell Name Original Value Final Value
$B$6 (0=no, 1=yes) 0 0
$B$7 (0=no, 1=yes) 1 1
$B$8 (0=no, 1=yes) 1 1
$B$9 (0=no, 1=yes) 0 0
$B$10 (0=no, 1=yes) 1 1
$B$11 (0=no, 1=yes) 1 1
$B$12 (0=no, 1=yes) 0 0

Constraints
Cell Name Cell Value Formula Status Slack
$D$13 Capital Required Year 1 $270 $D$13<=$D$14 Not Binding 30
$E$13 Capital Required Year 2 $150 $E$13<=$E$14 Binding 0
$F$13 Capital Required Year 3 $93 $F$13<=$F$14 Not Binding 57.5
$G$13 Capital Required Year 4 $86 $G$13<=$G$14 Not Binding 3.75
$H$13 Capital Required Year 5 $83 $H$13<=$H$14 Not Binding 6.875
$B$6 (0=no, 1=yes) 0 $B$6=binary Binding 0
$B$7 (0=no, 1=yes) 1 $B$7=binary Binding 0
$B$8 (0=no, 1=yes) 1 $B$8=binary Binding 0
$B$9 (0=no, 1=yes) 0 $B$9=binary Binding 0
$B$10 (0=no, 1=yes) 1 $B$10=binary Binding 0
$B$11 (0=no, 1=yes) 1 $B$11=binary Binding 0
$B$12 (0=no, 1=yes) 0 $B$12=binary Binding 0
IT Investment Problem

Investment Select ? Capital Required / Year


Project (0=no, 1=yes) NPV Year 1 Year 2 Year 3 Year 4 Year 5
1 0.00 74.00 22.00 20.00 18.00 16.00 14.00
2 1.00 233.00 100.00 20.00 20.00 20.00 20.00
3 1.00 177.00 50.00 25.00 12.50 6.25 3.13
4 0.00 190.00 40.00 30.00 20.00 10.00 0.00
5 1.00 287.00 90.00 90.00 45.00 45.00 45.00
6 1.00 107.00 30.00 15.00 15.00 15.00 15.00
7 0.00 301.00 120.00 120.00 60.00 60.00 60.00
Capital Required $270 $150 $92 $86 $83
Capital Available $300 $150 $150 $90 $90

Total NPV $804

Key:
Parameters
Decision Variables
Objective Function

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