Authors: Alican Comert; Meral Azizoglu
Addresses: Bosch Termotechic Heating and Air Conditioning Industry Trade Company, İzmir, Turkey ' Department of Industrial Engineering, Middle East Technical University, Ankara 06800, Turkey
Abstract: In this study, we consider a project payment model with discounted cash flows. We assume that the client payment times are defined in the project contract. The activities are characterised by their processing times and costs that are incurred at their completion times. Our problem is to find the activity completion times so as to maximise the net present value of the client payments and activity costs. We show that the problem is strongly NP-hard. We formulate the problem as a mixed integer nonlinear programming model and propose a branch and bound algorithm that employs efficient lower and upper bounding mechanisms.
Keywords: project scheduling; discounted cash flow; DCF; branch and bound algorithm; project payment models; activity completion times; net present value; NPV; client payments; activity costs; mixed integer nonlinear programming; MNLIP.
International Journal of Planning and Scheduling, 2016 Vol.2 No.3, pp.233 - 251
Received: 04 Mar 2016
Accepted: 18 Jul 2016
Published online: 11 Nov 2016 *