GGV Corp Is Considering the Expansion of Its Networking and Communication

Essay

GGV Corp. is considering the expansion of its networking and communication equipment production. Four projects are being considered. Projects A and B are mutually exclusive, and Projects C and D are mutually exclusive. Project C cannot be selected unless Project A or B has been selected. Project D is an optional add- on of Project A. The company's board of directors has approved $2 million for this expansion. In addition, because of limited personnel, only 27,000 labor hours can be committed to the expansion. Formulate the resource allocation problem as a linear programming model. Use a MARR of 7.2% per year.
$$4$$ $$\begin{array} { | l | l | l | l | l | } \hline \text { Initial costs } \$ & 410,000 & 560,000 & 595,000 & 635,000 \\\hline \begin{array} { l } \text { Net annual } \\\text { revenue, } \$\end{array} & 54,000 & 69,000 & 72,500 & 77,500 \\\hline \begin{array} { l } \text { Man- hours } \\\text { requirement } \\\text { hours }\end{array} & 11,000 & 12,500 & 12,950 & 13,250 \\\hline \text { Life, years } & 2 & 2 & 2 & 2 \\\hline\end{array}$$