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B. Problem Statement The Smooth Construction Company is planning to invest in several of eight (8) projects. Unfortunately, it faces a range of constraints such as budgetary, number of projects that it can supervise, and the relationship among projects (contingent and/or duplicative). The Company is seeking your assistance in selecting the projects that will maximize its Net Present Worth given different sets of constraints. All projects have the same lifespan. Projects Initial Cost NPW 300,000 65,000 B 250,000 45,000 190,000 35,000 D 375,000 50,000 E 325,000 75,000 F 425,000 85,000 320,000 80,000 H 450,000 70,000 MARR = 10% G Questions 20 to 23 a) Budget = $1,900,000 b) Investing in project C is contingent on investing in F, G and H. c) Investing in project C is contingent on investing in either D or H. d) Projects A and E are mutually exclusive. Select at most one (1) project. e) Use the NPW decision criterion to determine the "best" feasible bundle of projects. 20. 21. 22. 23. The best investment bundle consists of projects The NPW ($) of the best investment bundle is The total cost ($) of the best investment bundle is The second "best" project in this bundle is Questions 24 to 26 a) Budget = $1,500,000 4 Page b) Investing in project B is contingent on investing in projects D, E and F. c) Investing in project C is contingent on investing in at least two of D, G or H. d) Projects D, E and F are mutually exclusive. Select at most one project. e) Use the NPW decision criterion to determine the "best" feasible bundle of projects. 24. 25. 26. The best investment bundle consists of projects The NPW ($) of the best investment bundle is The total cost ($) of the best investment bundle is B. Problem Statement The Smooth Construction Company is planning to invest in several of eight (8) projects. Unfortunately, it faces a range of constraints such as budgetary, number of projects that it can supervise, and the relationship among projects (contingent and/or duplicative). The Company is seeking your assistance in selecting the projects that will maximize its Net Present Worth given different sets of constraints. All projects have the same lifespan. Projects Initial Cost NPW 300,000 65,000 B 250,000 45,000 190,000 35,000 D 375,000 50,000 E 325,000 75,000 F 425,000 85,000 320,000 80,000 H 450,000 70,000 MARR = 10% G Questions 20 to 23 a) Budget = $1,900,000 b) Investing in project C is contingent on investing in F, G and H. c) Investing in project C is contingent on investing in either D or H. d) Projects A and E are mutually exclusive. Select at most one (1) project. e) Use the NPW decision criterion to determine the "best" feasible bundle of projects. 20. 21. 22. 23. The best investment bundle consists of projects The NPW ($) of the best investment bundle is The total cost ($) of the best investment bundle is The second "best" project in this bundle is Questions 24 to 26 a) Budget = $1,500,000 4 Page b) Investing in project B is contingent on investing in projects D, E and F. c) Investing in project C is contingent on investing in at least two of D, G or H. d) Projects D, E and F are mutually exclusive. Select at most one project. e) Use the NPW decision criterion to determine the "best" feasible bundle of projects. 24. 25. 26. The best investment bundle consists of projects The NPW ($) of the best investment bundle is The total cost ($) of the best investment bundle is