Question
Consider the following projects and their cash flows (in millions): Project Period 0 1 2 3 4 5 1 -$322 $178 $228 $278 $328 $378
Consider the following projects and their cash flows (in millions): Project Period 0 1 2 3 4 5 1 -$322 $178 $228 $278 $328 $378 2 -$427 $122 $122 $122 $122 $122 3 -$314 $157 $131 $109 $91 $76 4 -$398 $118 $184 $183 $117 $138 Determine the number of feasible portfolios if (a) All projects are independent, but there is a $1.1 billion budget? (b) All projects are independent, but the budget is $750 million? (c) The budget is $1.1 billion, but projects 3 and 4 are mutually exclusive? (Note, Option A, B, C are mutually exclusive if no more than one can be chosen.) (d) Find the optimal portfolio in Part (c), using incremental investment analysis with the internal rate of return, assuming a MARR of 18%. (e) Find the optimal portfolio in Part (a), (b), and (c) using total investment analysis, present worth, and a MARR of 22 %. f) Find the optimal portfolio in part (c) using linear integer program.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started