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The board of directors is considering six large capital investment options. Each investment option can be made only once. These options differ in the estimated

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The board of directors is considering six large capital investment options. Each investment option can be made only once. These options differ in the estimated long-run prot (net present value) that they will generate as well as in the amount of capital required, as shown by the following table: Investment 0 tion Estimated Prot $rnillions Ca ital Re uired $rnillions 1 10 25 2 15 3t) 3 19 5t) 4 7 15 5 17 4t) 6 13 3'!) The total amount of capital available for these investment options is $90 million. Investment options 1 and 2 are mutually exclusive, and so are 3 and 4. Furthermore, neither 3 nor 4 can be undertaken unless one of the rst two options is undertaken. There are no such restrictions on investment options 5 and 6. The objective is to select the combination of the options that will maximize the total estimated long-run prot (net present value)

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