MGMT430 Columbia College Problem in Binary Integer Programming (BIP) in Excel

Consider a small Oil production firm with 5 competing oil production projects, A – E.

The table below shows the estimated long-term profit (Net Present Value) for each project as well as the amount of investment capital required to start the project.

You have been contacted to help select the best combination of projects to maximize the Net Present Value subject to the capital investment limit of $32 million.

Production Project

A

B

C

D

E

Estimated Profit (millions)

25

20

19

28

21

Capital Required (millions)

11

8

14

19

13

  • Formulate a Binary Integer Programming (BIP) model on an excel spreadsheet.
  • Solver the model using Solver in excel.
  • Insure all tables are properly formatted in excel and easy to read ex:borders, colors, text alignment
  • All formulas must be completed in excel and must be editable
 
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