Assume That We Are Using 0-1 Integer Programming Model to Solve

question 36

Multiple Choice

Assume that we are using 0-1 integer programming model to solve a capital budgeting problem and xj = 1 if project j is selected and xj = 0, otherwise.
The constraint (x1 + x2 + x3 + x4 = 2) means that ________ out of the ________ projects must be selected.

• A) exactly 1, 2
• B) exactly 2, 4
• C) at least 2, 4
• D) at most 1, 2

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Definitions:

Rival Companies

Firms operating in the same industry that compete against each other for market share.

Monopoly Power

Monopoly Power is the ability of a monopoly firm to set and control prices due to the lack of competitive market forces.

Wheat Farm

A type of agricultural establishment primarily engaged in the cultivation of wheat.

Natural Monopoly

A scenario in which a single company is able to offer a product or service more cheaply than any possible rivals, usually as a result of benefiting from the economies of scale.