The Following Questions Pertain to the Problem, Formulation, and Spreadsheet

question 11

Essay

The following questions pertain to the problem, formulation, and spreadsheet implementation below.
A research director must pick a subset of research projects to fund over the next five years. He has five candidate projects, not all of which cover the entire five-year period. Although the director has limited funds in each of the next five years, he can carry over unspent research funds into the next year. Additionally, up to $30K can be carried out of the five-year planning period. The following table summarizes the projects and budget available to the research director.
The following is the ILP formulation and a spreadsheet model for the problem.

-Refer to Exhibit 6.1. What values would you enter in the Risk Solver Platform (RSP) task pane for the above Excel spreadsheet?
Objective Cell:
Variables Cells:
Constraints Cells:

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Definitions:

Isoquants

Curves that represent combinations of various inputs which yield the same level of output.

Isocost Lines

Graphical representations in economic theory that showcase all possible combinations of inputs that can be purchased for a given total cost.

Isocost Line

A visual depiction in economics indicating every potential mix of inputs that have an identical overall cost.

Cost Of Capital

The total cost of funds used for financing a business, which may include debt and equity financing costs.