8. Yash B'Gosh is a manager for a company that is considering four projects for possible adoption; two of the projects (A and C) are IT projects. Yash has estimated the cost per year for each project; these cost estimates are indicated in the following table.

The company can fund project in part or in total; however, it cannot change the funding percentage once the project has been started (for example, if Project A is funded at a 50 percent level, then this project will cost $20 in the first year, $5 in the second year, aid $10 in the third and fourth years).

The value of each project to the company is indicated by the project score; if the project is only partially funded, the project score is scaled proportionately (for example, if Project A is funded at a 50 percent level, the company gains 0.5 x 0.741 = 0.3705).

Yash wants to select a project portfolio that maximizes the total score, subject to the budget constraints. In addition, top management has stated that funding on IT projects should not exceed 40 percent of total funding on projects over the next five years.

1 2 3 4 5 Project Score ProjectA (IT) $ 40 $10 $20 $20 - 0.741 Project B $ 65 $36 $30 $25 $30 0.845 Project C (IT) $ 6 $ 8 $10 - - 0.353 Project D $ 20 $10 $20 $20 - 0.457 Available funds $120 $40 $40 $55 $60

a. Given the constraints, which projects should Yash recommend for funding? At what level?

b. Assume that Yash has the choice of delaying some of the projects as long as all selected projects can be completed in five years. Should Yash recommend that any projectis) be delayed; and if so, which projects and how long?