Harmon Corporation has four potential projects: M, N, O, and P. Projects O and P are mutually exclusive. The table provides the required investment and NPV for each project.

	Required
	Investment	NPV
Project	($ in million)	($ in million)
M	$7.00	$3.50
N	$5.00	$4.00
O	$3.00	$2.00
P	$1.50	$1.30

Using the information in the table, answer the following questions.

1. Make a table of all the possible capital budgeting strategies based on the combination of the four available projects. Calculate the required investment and NPV of each strategy in the table. Round your answers to two decimal places.

   		Required
   		Investment	NPV
   Strategy	Project	($ in million)	($ in million)
   1	M	$	$
   2	N	$	$
   3	O	$	$
   4	P	$	$
   5	M and N	$	$
   6	M and O	$	$
   7	M and P	$	$
   8	N and O	$	$
   9	N and P	$	$
   10	M, N, and O	$	$
   11	M, N, and P	$	$

2. If the firm is not capital constrained, which projects would be selected, what would be the optimal capital budget, and what would be the NPV for that optimal capital budget? Round your answers to two decimal places.

   With no capital constraint, Harmon Corporation would select project(s) -Select-MNOPM and NM and OM and PN and ON and PM, N, and OM, N, and PItem 23 , the optimal capital would be $ million, and the NPV for that optimal capital budget would be $ million.

3. Suppose that the firm is now capital constrained and only has $12 million of available capital. Which projects would be selected, what would be the optimal capital budget subject to the capital constraint, and what would be the NPV for that capital budget? Round your answers to two decimal places.

   With the capital constraint, Harmon Corporation would select project(s) -Select-MNOPM and NM and OM and PN and ON and PM, N, and OM, N, and PItem 26 , the optimal capital would be $ million, and the NPV for that optimal capital budget would be $ million.

4. Because of the capital constraint, how much value does the firm lose between the NPVs of the selected projects in parts b and c? Round your answer to two decimal places.

   $ million