Project scheduling with discounted cash flows and progress payments

In all large scale projects, there correspond cash flows that incur throughout the life of the project. The scheduling of these projects to maximize the present value of the cash flows has been a topic of recent research. The basic assumption of earlier research is that the cash flows are mainly associated with some events of the project and they occur at the event realization times. However, in several real life projects, the cash inflows do not occur at the event realization times, rather they occur at the end of some time periods, like months, as progress payments. In this article, maximizing the present value of the cash flows in such projects is considered and a mixed-integer formulation of the problem is presented. In this formulation, activity profit curves are defined and used. Computational experience on some randomly generated test problems provides promising results especially when the Benders Decomposition technique is employed for solving the problem.