Question

Six projects have been identified for possible implementation by a company that makes dry ice blasters, machines that propel tiny dry ice pellets at supersonic speeds so they flash freeze and then lift grime, paint, rust, mold, asphalt, and other contaminants off in-place machines and a wide range of surfaces. The present worth of each project has been determined. Identify all acceptable mutually exclusive bundles if the budget limitation is $38,000. Arrange the acceptable bundles in such a way that the total PW values are in ascending order.

Project	Project PW at 15%, $
L	29,000
M	11,000
N	41,000
O	35,000
P	6,000
Q	2,000

Answer 1

Projects in ascending order of PW are ranked as follows (Rank 1: Lowest PW and Rank 6: Highest PW).

Project	PW ($)	Rank
Q	2,000	1
P	6,000	2
M	11,000	3
L	29,000	4
O	35,000	5
N	41,000	6

Let initial investment for projects N, O, L, M, P and Q be C1, C2, C3, C4, C5 and C6 respectively.

Projects with highest PW will be selected first. So in order of acceptance,

N > O > L > M > P > Q.

As long as (C1 + C2 + C3....) does not exceed $38,000, the projects will be selected. Since values of initial investment of projects are not provided, we cannot say which projects are to be selected.