Investment Scheduling of Maximizing Net Present Value of Dividend with Reinvestment Allowed

This paper deals with an investment scheduling problem of maximizing net present value of dividend with reinvestment allowed, where each investment has certain capital requirement and generates deterministic profit. Such deterministic profit is calculated at completion of each investment and then allocated into two parts, including dividend and reinvestment, at each predetermined reinvestment time point. The objective is to make optimal scheduling of investments over a fixed planning horizon which maximizes total sum of the net present values of dividends subject to investment precedence relations and capital limit but with reinvestment allowed. In the analysis, the scheduling problem is transformed to a kind of parallel machine scheduling problem and formulated as an integer programming which is proven to be NP-complete. Thereupon, a depth-first branch-and-bound algorithm is derived. To test the effectiveness and efficiency of the derived algorithm, computational experiments are performed with some numerical instances. The experimental results show that the algorithm solves the problem relatively faster than the commercial software package (CPLEX 8.1), and optimally solves the instances with up to 30 investments within a reasonable time limit.