In a BIP Problem, 1 Corresponds to a Yes Decision

question 45

Multiple Choice

In a BIP problem, 1 corresponds to a yes decision and 0 to a no decision. If project A can be undertaken only if project B is also undertaken then the following constraint needs to be added to the formulation:

• A) A + B ≤ 1.
• B) A + B = 1.
• C) A ≤ B.
• D) B ≤ A.
• E) None of the choices is correct.

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Definitions:

Cash

Liquid funds available for use in the form of currency or bank balances.

Treasury Stock

Company-released shares that have been bought back, consequently lowering the overall available shares for trading.

Par Common Stock

The face value of a share of common stock as specified in the corporate charter, with no bearing on the market value.

Fair Market Price

The price at which an asset would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.