2.

a. Mr. Books is concerned about delaying the delivery of the America's Cup boat in Problem 1. How much does the $5000 payment made at milestone M1 have to be decreased such that the project will NOT be delayed beyond its critical path and still maximize the NPV of the project?

b. A total of $6000 will be paid by the client in Problem 1 ($3000 at milestone M2 and $3000 at the end of the project). If the client pays more than $3000 at milestone M2 and less at the end of the project (but still only pays a total of $6000), will this reduce the project makespan of the solution that maximizes the NPV

(assume that a payment of $5000 is still made at milestone MI)? If so, how much would have to be paid at milestone M2?