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 currentlyavailable capital.Max 100x1 + 120x2 + 90x3 + 135x4s.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}{1, if projecteſ 1, if project j is selectedxj=Which constraint ensures that the firm will not spend more capital than it has available (assume that each potentialproject has a different cost)? Multiple ChoiceOOOConstraint 5Constraint 4Constraint 3Constraint 1Constraint 2

LPP constraints: The constraints or caps on the total quantity of a certain resource needed to…

Answered: Which constraint ensures that the firm…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter9: Decision Making Under Uncertainty

Section: Chapter Questions

Problem 34P

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1. If constraint has a shadow price of $6, Right-Hand-Side (RHS) is 12, allowable increase is 2, allowable decrease is 4. How would objective function change if the RHS of this constrains changes from 12 to 9? Answer___________
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Which constraint ensures that the firm will not spend more capital than it has available (assume that each potential project has a different cost)?