he government is auctioning off oil leases at two sites. At each site, 150,000 acres of land are to be auctioned. Cliff Ewing, Blake Barnes, and Alexis Pickens are bid- ding for the oil. Government rules state that no bidder can receive more than 45% of the land being auctioned. Cliff has bid $2000 per acre for site 1 land and $1000 per acre for site 2 land. Blake has bid $1800 per acre for site 1 land and $1500 per acre for site 2 land. Alexis has bid $1900 per acre for site 1 land and $1300 per acre for site 2 land. a. Determine how to maximize the government’s revenue with a transportation model. b. Use SolverTable to see how changes in the government’s rule on 45% of all land being auctioned affect the optimal revenue. Why can the optimal revenue not decrease if this percentage required increases? Why can the optimal revenue not increase if this percentage required decreases?
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The government is auctioning off oil leases at two sites. At each site, 150,000 acres of land are to be auctioned. Cliff Ewing, Blake Barnes, and Alexis Pickens are bid- ding for the oil. Government rules state that no bidder can receive more than 45% of the land being auctioned. Cliff has bid $2000 per acre for site 1 land and $1000 per acre for site 2 land. Blake has bid $1800 per acre for site 1 land and $1500 per acre for site 2 land. Alexis has bid $1900 per acre for site 1 land and $1300 per acre for site 2 land.
a. Determine how to maximize the government’s revenue with a transportation model.
b. Use SolverTable to see how changes in the government’s rule on 45% of all land being auctioned affect the optimal revenue. Why can the optimal revenue not decrease if this percentage required increases? Why can the optimal revenue not increase if this percentage required decreases?
![1 Oil lease auction
2
3
4
5
Ewing
6 Bames
7 Pickens
8
9
10
HHHHHHH9222
12
11 Number of acres sold to bidders
17
13 Ewing
14 Bames
15 Pickens
16 Total
19
18 Available
21
Bids for sites (dollars/acre)
25
26
20 Revenue ($millions)
27
28
29
30
31
32
33
34
X✓ fx
Max % that can be sold to any bidder
23 Maximum land perchased
24
35
36
37
38
39
40
A
n.
Point
cirement
P5-43
2000
1800
1900
=SUM(B13:815)
-0.45*(SUM(F13:F14))
B
0.45
P5-46
SUMPRODUCT(B5:C7,813:C15)
Site 1
STS_1
Site 1
1000
1500
1300
C
=SUM(C13:C15)
P5-52
Site 2
-0.45*(SUM(F13:F14))
+
Site 2
Kula Anderson SELICT
D
=SUM(B13:C13)
=SUM(B14:C14)
-SUM(B15:C15)
Total
-0.45*(SUM(F13:F14))
<=
KE
E
Set Objective:
150000
150000
$B$20
F
To: O Max
Min
By Changing Variable Cells:
SBS13:SC$15
Solver Parameters
Advanced
Max allowed
1 Value Of:
Subject to the Constraints:
$B$16:$C$16 <= $F$13:$F$14
$D$13:$D$15 <= $B$18:$D$18
Make Unconstrained Variables Non-Negative
Select a Solving Method:
Simplex LP
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0
G
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Solving Method
Select the GRG Nonlinear engine for Solver Problems that are smooth
nonlinear. Select the LP Simplex enaine for linear Solver Problems.
Ex 2
MIN](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7560699c-8423-405a-882d-a75c5ae74d55%2F7295d482-a9c4-4812-bd31-55f73bb53209%2Fu55tgb_processed.jpeg&w=3840&q=75)
![A
1 Oil lease auction
2
3 Bids for sites (dollars/acre)
4
5 Ewing
6 Bames
7 Pickens
8
9 Max % that can be sold to any bidder
10
11 Number of acres sold to bidders
12
13 Ewing
14 Bares
15 Pickens
16 Total
22
23 Maximum land pell
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
▶
B
17
18 Available
19
20 Revenue ($millions $520,500,000
21
111
Site 1
$2,000
$1,800
$1,900
P5-43
Site 1
135000
0
15000
150000
$135,000
0.45
C
P5-46
Site 2
$1,000
$1,500
$1,300
Site 2
0
135000
15000
150000
$135,000
D
Total
135000
135000
30000
$135,000
STS_1
E
<=
<=
LL
F
G
Specify the following information about the input
to be varied and the outputs to be captured.
Input cell:
$B$23
(Optional) Descriptive
name for input:
Output cell(s):
Max allowed
150000
150000
Parameters for oneway table
Values of input to use for table
O Base input values on following:
Minimum value:
0.3
0.9
Maximum value:
Increment:
0.05
Max pct per bidder
Use the values from the following range:
Input value range:
Use the values below (separate with
Input values:
$B$20
H
OK
Cancel
Note about specifying output cells: The safest way to select multiple
output cells or ranges is to put your finger on the Ctrl key and then drag
as many output cell ranges as you like. This will automatically insert
commas between the ranges you select.
1
J
K
L
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