B. Problem Statement Saigon Company is planning to invest in several of eight (8
ID: 2794436 • Letter: B
Question
B. Problem Statement Saigon Company is planning to invest in several of eight (8) projects. However, it faces several constraints such as budgetary, maximum number of projects, and the relationship among projects (contingent and/or duplicative) The Company is seeking your assistance in selecting the projects that will maximize its Net Present Worth given the different set of constraints NPW $35,000 45,000 10,000 65,000 95.000 40,000 14,000 90,000 Projects Initial Cost $125,000 175,000 100,000 250,000 225,000 320,000 190,000 350.000 (xxx) = Negative NPW: MARR = 10%Explanation / Answer
Rank on the basis of NPW
Project Name
NPW
Initial investment
1
E
95000
225000
2
H
90000
350000
3
D
65000
250000
4
B
45000
175000
5
A
35000
125000
total
330000
1125000
10-
Answer is B
ABDEH
11-
NPW of the investment bundle
Answer is B
330000
12-
total cost of investment bundle
Answer is B
1125000
Rank on the basis of NPW
Project Name
NPW
Initial investment
1
E
95000
225000
2
H
90000
350000
3
D
65000
250000
4
B
45000
175000
5
A
35000
125000
total
330000
1125000
10-
Answer is B
ABDEH
11-
NPW of the investment bundle
Answer is B
330000
12-
total cost of investment bundle
Answer is B
1125000
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