An entrepreneur with $8 million to invest is considering acquisition of four companies. She estimates the cost of acquiring the four at $5, $1, $2, and $7 million, respectively, and the present value of owning them at $8, $3, $4, and $10. Investments are on an "all or nothing" basis (i.e., she must buy entire companies). Model as a dynamic program the problem of deciding which investments she should choose. a) Formulate the entreprenur's problem as an Integer Knapsack model. b) Define the states and stages of the corresponding discrete dynamic program to compute an optimum. c) Draw the digraph corresponding to your model of (b). d) Solve the model of (a) by identifying an optimal path in the figure of (c).
An entrepreneur with $8 million to invest is considering acquisition of four companies. She estimates the cost of acquiring the four at $5, $1, $2, and $7 million, respectively, and the present value of owning them at $8, $3, $4, and $10. Investments are on an "all or nothing" basis (i.e., she must buy entire companies). Model as a dynamic program the problem of deciding which investments she should choose. a) Formulate the entreprenur's problem as an Integer Knapsack model. b) Define the states and stages of the corresponding discrete dynamic program to compute an optimum. c) Draw the digraph corresponding to your model of (b). d) Solve the model of (a) by identifying an optimal path in the figure of (c).
Chapter6: Systems Of Equations And Inequalities
Section: Chapter Questions
Problem 21T: A manufacturer produces two models of television stands. The table at the left shows the times (in...
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