7.51. Capital Budgeting with Contingency Constraints A company is planning its capital budget over the next several years. There are eight potential projects under consideration. A calculation has been made of the expected net present value of each project, along with the cash outflow that would be required over the next four years. These data, along with the cash that is available each year, are shown in the next table. There also are the following contingency constraints: (a) at least one of project 1, 2, or 3 must be done, (b) projects 6 and 7 cannot both be done, and (c) project 5 can only be done if project 6 is done. Formulate and solve a BIP model in a spreadsheet to determine which projects should be pursued to maximize the total expected net present value. page 267 Cash Outflow Required (Smillion) Project Cash Available (Smillion) 1 8 Year 1 Year 2 Year 3 Year 4 NPV (Smith 1 2 2 2 3 2. 3 MONO- 3 2 2 5 3 2 3 4 7 3 3 2 2 3 6 1 5 4 2 2 20 20 20 20 1 10 11 15 24 17 16 18