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please show step by step procedure using excel sheet Problem 1: Fox Enterprises is considering six projects for possible construction over the next 4 years.
please show step by step procedure using excel sheet
Problem 1: Fox Enterprises is considering six projects for possible construction over the next 4 years. Fox can undertake any of the projects partially completely. A partial undertaking of a project will prorate both the return and cash outlays proportionately. The expected (present value) returns and cash outlays for the projects are given in the following table. Project 1 2 3 4 5 6 Available funds ($1000) Year 1 10.5 8.3 10.2 7.2 12.3 9.2 60.0 Cash outlay ($1000) Year 2 Year 3 14.4 2.2 12.6 9.5 14.2 5.6 10.5 7.5 10.1 8.3 7.8 6.9 70.0 35.0 Year 4 2.4 3.1 4.2 5.0 6.3 5.1 20.0 Return ($1000) 32.40 35.80 17.75 14.80 18.20 12.35 (a) Formulate the problem to determine the optimal project mix that maximizes the total return. (b) Suppose that if a portion of project 2 is undertaken, then at least an equal portion of projects 6 must be undertaken. Modify the formulation of the model Step by Step Solution
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