In a Capital Budgeting Problem, If Either Project 1 or Project

question 49

Multiple Choice

In a capital budgeting problem, if either project 1 or project 2 is selected, then project 5 cannot be selected. Which of the alternatives listed below correctly models this situation?

• A) x1 + x2 + x5 ≤ 1
• B) x1 + x2 + x5 ≥1
• C) x1 + x5 ≤ 1, x2 + x5 ≤ 1
• D) x1 - x5 ≤ 1, x2 - x5 ≤ 1

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Definitions:

Sales

The exchange of a product or service for money, typically seen as a unit of measurement for business performance.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.

Fixed Assets

Long-term tangible assets, such as buildings, machinery, and equipment, used in the operations of a business and not expected to be converted to cash in the short term.

Balanced Scorecard

A system for strategic planning and management designed to synchronize business actions with the organization's strategy and vision, bolster communication within and outside the organization, and oversee the performance of the organization in relation to its strategic targets.