Using the attached template answer the following question. (Note that the data from P06_40.xlsx is already in the excel sheet) You are given a group of possible investment projects for your company’s capital. For each project, you are given the NPV the project would add to the firm, as well as the cash outflow required by each project during each year. Given the information in the file P06_40.xlsx, determine the investments that maximize the firm’s NPV. The firm has $25 million available during each of the next five years. All numbers are in millions of dollars.

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
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Using the attached template answer the following question. (Note that the data from P06_40.xlsx is already in the excel sheet)

You are given a group of possible investment projects for your company’s capital. For each project, you are given the NPV the project would add to the firm, as well as the cash outflow required by each project during each year. Given the information in the file P06_40.xlsx, determine the investments that maximize the firm’s NPV. The firm has $25 million available during each of the next five years. All numbers are in millions of dollars.

LE3458122322258
1 Capital budgeting
7 Year 1
8 Year 2
Year 3
10 Year 4
11 Year 5
12 NPV
16
17
18 Budget constraints
19
20 Year 1
21 Year 2
A
22 Year 3
23 Year 4
24 Year 5
27
Note: All cash amounts are in $millions.
29
Cash outflows in various years, NPV of projects
Project 1
$1
26 Total NPV
30
x ✓ fx
14 Selected projects (1 if selected, 0 if not)
Þ
B
PG-40
555552
$3
$2
$1
$2
C
Outflow
DR A
Project 2 Project 3 Project 4
$3
$4
$4
$4
555555
$3
$1
$1
$30
D
Project 1 Project 2 Project 3
$3
$2
$3
$35
Budget
E
*******
$6
$5
$2
$2
$8
$40
******
$1
$2
$3
$5
- 12
Project 5 Project 6 Project 7 Project 8 Project 9 Project 10 Project 11 Project 12
$5
$2
$0
$9
$8
$42
G
**555*
$4
$5
$1
H
$5
$6
$20
55555
$3
$3
$4
$7
$30
$0
$4
$6
$3
$31
General
$%9
$1
$1
$4
265333E
$8
$33
$6
fun.cc5
$3
$2
$4
$1
$35
$1
538-28
$2
$1
$1
$1
$37
Project 4 Project 5 Project 6 Project 7 Project 8 Project 9 Project 10 Project 11 Project 12
$7
54
$2
$1
538
M
Tell me
Conditional Formatt
Format as Table
Cell Styles
N
Transcribed Image Text:LE3458122322258 1 Capital budgeting 7 Year 1 8 Year 2 Year 3 10 Year 4 11 Year 5 12 NPV 16 17 18 Budget constraints 19 20 Year 1 21 Year 2 A 22 Year 3 23 Year 4 24 Year 5 27 Note: All cash amounts are in $millions. 29 Cash outflows in various years, NPV of projects Project 1 $1 26 Total NPV 30 x ✓ fx 14 Selected projects (1 if selected, 0 if not) Þ B PG-40 555552 $3 $2 $1 $2 C Outflow DR A Project 2 Project 3 Project 4 $3 $4 $4 $4 555555 $3 $1 $1 $30 D Project 1 Project 2 Project 3 $3 $2 $3 $35 Budget E ******* $6 $5 $2 $2 $8 $40 ****** $1 $2 $3 $5 - 12 Project 5 Project 6 Project 7 Project 8 Project 9 Project 10 Project 11 Project 12 $5 $2 $0 $9 $8 $42 G **555* $4 $5 $1 H $5 $6 $20 55555 $3 $3 $4 $7 $30 $0 $4 $6 $3 $31 General $%9 $1 $1 $4 265333E $8 $33 $6 fun.cc5 $3 $2 $4 $1 $35 $1 538-28 $2 $1 $1 $1 $37 Project 4 Project 5 Project 6 Project 7 Project 8 Project 9 Project 10 Project 11 Project 12 $7 54 $2 $1 538 M Tell me Conditional Formatt Format as Table Cell Styles N
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ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,