Skip to main content

Exam $2$

AnswerSaved

Help opens in a new windowSave & ExitSubmit

Item$13$

eBookReferences

Item $13$

Note: This problem requires the use of a linear programming application such as Solver or Analytic Solver.

A firm has prepared the following binary integer program to evaluate a number of potential locations for new warehouses. The firm$$s goal is to maximize the net present value of their decision while not spending more than their currently available capital.

Max $20$x$1+30$x$2+10$x$3+15$x$4$

s$.$t$.5$x$1+7$x$2+12$x$3+11$x$421\{$Constraint $1\}$

x$1+$ x$2+$ x$3+$ x$42\{$Constraint $2\}$

x$1+$ x$21\{$Constraint $3\}$

x$1+$ x$31\{$Constraint $4\}$

x$2=$ x$4\{$Constraint $5\}$

xj$=\{1,$if$$location$$j$$is$$selected$0,$otherwisexj$=1,$if$$location$$j$$is$$selected$0,$otherwise

Set up the problem in Excel and find the optimal solution. Which locations are selected?

Multiple Choice

Location $2$

Locations $2$ and $4$

Location $4$

Location $1$

Locations $1$ and $3$