Your employer is trying to select from a list of possible capital projects. The projects, along with their cost and benefits, are listedbelow. The capital budget available is $1 million. In addition to spending constraints, your employer would like to select at least 3projects. Projects 1 and 4 cannot both be selected together. Formulate the problem as a linear program and determine the optimalsolution.Project12345Cost$300,000$260,000$215,000$240,000$295,000Which projects should be selected?Project 1 willProject 2 willProject 3 willProject 4 willProject 5 willNet Present Value$720,000$780,000be selectednot be selectedTotal net present value$690,000$700,000$510,000What is the total net present value of these projects?

Linear programming is a mathematical technique that is also used in operations management…

Answered: Which projects should be selected?

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter11: Simulation Models

Section11.3: Financial Models

Problem 23P: Suppose you currently have a portfolio of three stocks, A, B, and C. You own 500 shares of A, 300 of...

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