A Firm Has Prepared the Following Binary Integer Program to Evaluate

question 20

Multiple Choice

A firm has prepared the following binary integer program to evaluate a number of potential new capital projects. The firm's goal is to maximize the net present value of their decision while not spending more than their currently available capital.
Max 100x1 + 120x2 + 90x3 + 135x4
s.t. 150x1 + 200x2 + 225x3 + 175x4 ? 500 {Constraint 1}
X1 + x2 + x3 + x4 ? 2 {Constraint 2}
X2 + x4 ? 1 {Constraint 3}
X2 + x3 ? 1 {Constraint 4}
X1 = x4 {Constraint 5} $$x _ { j } = \left\{ \begin{array} { l } 1 , \text { if project } j \text { is selected } \\0 , \text { otherwise }\end{array} \right.$$
Which constraint ensures that the firm will not spend more capital than it has available (assume that each potential project has a different cost) ?

• A) Constraint 1
• B) Constraint 2
• C) Constraint 3
• D) Constraint 4
• E) Constraint 5

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Definitions:

Dermis

The thick layer of skin beneath the epidermis that contains nerve endings, sweat glands, and blood vessels.

Thermoregulatory Center

The part of the brain that regulates body temperature, located in the hypothalamus.

Sensory Receptors

Specialized cells or nerve endings that respond to changes in the environment by converting energy from stimuli into nerve impulses.

Hollow Interior

Refers to the inner empty space or cavity within an organ or structure.