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(Solved): [30 pts.] Five projects are available for investment. The projects require the cash flows and yield ...



[30 pts.] Five projects are available for investment. The projects require the cash flows and yield the net present values (NPV) (in millions) shown in the following table. \table[[Project id.,Cash outflow at time 0 (million Lira),NPV (million Lira)],[1,4,2],[2,5,3],[3,3,4],[4,1,1],[5,4,3]] If 11 million Lira is available for investment at time 0 , find the investment plan that maximizes NPV. All investments are required to be 0 or 1 (fractional investment values are not permitted). Find the optimal solution by using Branch and Bound method (Draw the branch and bound tree clearly, write also lower bounds(LB)) (Left branches

x_(1)=0

, right branches

x_(1)=1

).

-1-
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