A brewery produces regular beer and a lower-carbohydrate "light" beer. Steady customers of the brewery buy 10 units of regular beer and 15 unitsof light beer monthly. While setting up the brewery to produce the beers, the management decides to produce extra beer, beyond that needed tosatisfy customers. The cost per unit of regular beer is $29,000 and the cost per unit of light beer is $50,000. Every unit of regular beer brings in$200,000 in revenue, while every unit of light beer brings in $500,000 in revenue. The brewery needs at least $15,000,000 in revenue, and hasdetermined that the total demand will be at least 48 units of beer. Complete parts (a) and (b)BELED(a) How much of each type of beer should be made so as to minimize total production costs?units of light beer should be made, for a minimum total cost of $units of regular beer and(Type integers or decimals.)(b) Suppose the minimum revenue is increased to $15,700,000. Use shadow costs to calculate the total production cost.The shadow cost of production is $ The increased minimum revenue corresponds to a total production cost of $(Type integers or decimals.)

Let the number of regular beer units produced be R and light beer units be L. Minimum Regular beer…

Answered: A brewery produces regular beer and a…

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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Mancuso's Music Store is a small business that sells instruments, books, stands, and other music-related products. The owner always likes to have extra music stands in storage in case a large order arrives suddenly - typically 2 weeks' worth of sales. When an order is placed, the delivery takes 5 business days to arrive. The owner has studied working capital management and estimates that the economic order quantity for music stands is 1500 for each time an order is placed. The fixed cost of an order is $210 and the carrying cost per stand per year is $1.70. How many music stands will the store have in stock immediately after a shipment arrives? Assume the store is closed on Sundays (a 6-day business week), holidays, and a few vacation days, so that the store has 300 business days per year. Give your answer rounded to the nearest whole number of music stands. Do not include comma separators in your answer.
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