Constructive derivation in dynamic programing modeling

Constructive derivation of dynamic programing recursive equations proceeds by straightforward rearrangement of standard formulation as a constrained optimization problem. The advantage of constructive derivation over direct writing of recursive equations is demonstrated by application to a sequencing problem for which incorrect and correct formulations have been published. The problem is to find a minimal present cost sequence of N water supply projects having known capacities and installation costs to meet a given schedule of nondecreasing demands for total installed capacity.