3. A manager wants to know how many units of each product to produce on a daily basis in order to achieve the highest contribution to profit. Production requirements for the products are shown in the following table: Material 1 Material 2 (pounds) 3 Labor Product (pounds) (hours) 3.2 1.5 A B 1 5 C 6. Product A sells for $80 a unit, product B sells for $90 a unit, and product C sells for $70 a unit. Available resources each day are 200 pounds of material 1; 300 pounds of material 2; and 150 hours of labor. The manager must satisfy certain output requirement: The output of product A should not be more than one-third of the total number of unit produced; the ratio of units of product A to units of product B should be 3 to 2; and there is a standing order for 5 units of product A each day. (Hind: six constrains: material 1, material 2, labor, A output 1/3, ratio of product A and product B, product A order) Please define the decision variables, the objective function, and formulate the constraints. Next, please formulate the LP model and solve for the optimal values of the decision variables and the maximum profit on Excel Solver.
3. A manager wants to know how many units of each product to produce on a daily basis in order to achieve the highest contribution to profit. Production requirements for the products are shown in the following table: Material 1 Material 2 (pounds) 3 Labor Product (pounds) (hours) 3.2 1.5 A B 1 5 C 6. Product A sells for $80 a unit, product B sells for $90 a unit, and product C sells for $70 a unit. Available resources each day are 200 pounds of material 1; 300 pounds of material 2; and 150 hours of labor. The manager must satisfy certain output requirement: The output of product A should not be more than one-third of the total number of unit produced; the ratio of units of product A to units of product B should be 3 to 2; and there is a standing order for 5 units of product A each day. (Hind: six constrains: material 1, material 2, labor, A output 1/3, ratio of product A and product B, product A order) Please define the decision variables, the objective function, and formulate the constraints. Next, please formulate the LP model and solve for the optimal values of the decision variables and the maximum profit on Excel Solver.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Customary Pricing
There are various types of pricing strategies followed in the market. They are psychological pricing, odd pricing, free onboard pricing, customary pricing, prestige pricing, dual pricing, ruling pricing, negotiated pricing, mark up pricing, etc. each one can be explained as follows:
Multiple Unit Pricing
“Multiple-unit pricing is a practice where a company offers consumers a lower than unit price if a specified number of units are purchased.”
Question
Transcribed Image Text:3. A manager wants to know how many units of each product to produce on a daily basis in order to achieve the
highest contribution to profit. Production requirements for the products are shown in the following table:
Material 1
Material 2
(pounds)
3
Labor
Product
(pounds)
2
(hours)
3.2
A
1
1.5
B
C
6.
Product A sells for $80 a unit, product B sells for $90 a unit, and product C sells for $70 a unit. Available
resources each day are 200 pounds of material 1; 300 pounds of material 2; and 150 hours of labor. The
manager must satisfy certain output requirement: The output of product A should not be more than one-third of
the total number of unit produced; the ratio of units of product A to units of product B should be 3 to 2; and
there is a standing order for 5 units of product A each day. (Hind: six constrains: material 1, material 2, labor, A
output 1/3, ratio of product A and product B, product A order)
Please define the decision variables, the objective function, and formulate the constraints. Next, please
formulate the LP model and solve for the optimal values of the decision variables and the maximum profit on
Excel Solver.
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