# Question: The models in this section are often called combinatorial models

The models in this section are often called combinatorial models because each solution is a combination of the various 0s and 1s, and there are only a finite number of such combinations. For the capital budgeting model in Figure 14.40, there are seven investments, so there are 27 = 128 possible solutions (some of which are infeasible). This is a fairly large number, but not too large. Solve the model without Solver by listing all 128 solutions. For each, calculate the total cash requirement and total NPV for the model. Then manually choose the one that stays within the budget and has the largest NPV.

**View Solution:**## Answer to relevant Questions

Make up an example, as described in Problem 54, with 20 possible investments. However, do it so that the ratios of NPV to cash requirement are in a very tight range, from 3.0 to 3.2. Then use Solver to find the optimal ...For each of the following, answer whether it makes sense to multiply the matrices of the given sizes. In each case where it makes sense, demonstrate an example in Excel, where you make up the numbers. a. AB, where A is 3 x 4 ...A bank is attempting to determine where to invest its assets during the current year. At present, $500,000 is available for investment in bonds, home loans, auto loans, and personal loans. The annual rates of return on each ...Based on Bean et al. (1987). Boris Milkemâ€™s firm owns six assets. The expected selling price (in millions of dollars) for each asset is given in the file S14_89.xlsx. For example, if asset 1 is sold in year 2, the firm ...You are a CFA (chartered financial analyst). An overextended client has come to you because she needs help paying off her credit card bills. She owes the amounts on her credit cards listed in the file S14_98.xlsx. The client ...Post your question