Sunblessed Juice Company sells bags of oranges and cartons of orange juice. Sunblessed grades oranges on a scale of 1 (poor) to 10 (excellent). At present, Sunblessed has 220,000 pounds of grade 6 oranges and 150,000 pounds of grade 9 oranges on hand. The aver- age quality of oranges sold in bags must be at least 7, and the average quality of the oranges used to produce orange juice must be at least 8. Each pound of oranges that is used for juice yields a revenue of $2.25 and in- curs a variable cost (consisting of labor costs, variable overhead costs, inventory costs, and so on) of $1.35. Each pound of oranges sold in bags yields a revenue of $2.00 and incurs a variable cost of $1.20. a.    Determine how Sunblessed can maximize its profit. b.    Use SolverTable to determine how a change in the cost per bag of oranges changes the optimal solution. c.    Use SolverTable to determine how a change in the amount of grade 6 oranges available affects the optimal solution. d.    Use SolverTable to determine how simultaneous changes in the required average quality required for juice and the average quality required for bags change the optimal solution

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Sunblessed Juice Company sells bags of oranges and cartons of orange juice. Sunblessed grades oranges on a scale of 1 (poor) to 10 (excellent). At present, Sunblessed has 220,000 pounds of grade 6 oranges and 150,000 pounds of grade 9 oranges on hand. The aver- age quality of oranges sold in bags must be at least 7, and the average quality of the oranges used to produce orange juice must be at least 8. Each pound of oranges that is used for juice yields a revenue of $2.25 and in- curs a variable cost (consisting of labor costs, variable overhead costs, inventory costs, and so on) of $1.35. Each pound of oranges sold in bags yields a revenue of $2.00 and incurs a variable cost of $1.20.

a.    Determine how Sunblessed can maximize its profit.

b.    Use SolverTable to determine how a change in the cost per bag of oranges changes the optimal solution.

c.    Use SolverTable to determine how a change in the amount of grade 6 oranges available affects the optimal solution.

d.    Use SolverTable to determine how simultaneous changes in the required average quality required for juice and the average quality required for bags change the optimal solution

Open recovered workbooks? Your recent changes were saved.
B10
X ✓ fx
A
B
C
D
E
F
1 Selling oranges and orange juice
2
3 Revenues, variable costs
4
5 Revenue
6 Variable cost
7
Available
45
8
91012311516
$2.00
$1.20
Grades used to make juice and bags
Grade
Juice
6
9
Sold
14 Required average quality
17
18 Quality constraints
19
20 Actual
21
22 Required
23
24 Total variable cost
25 Total revenue
26
27 Profit
28
29
Ready
188
Bags
P4-50 Model
Juice
Juice
Juice
$2.25
$1.35
Bags
Bags
Used
Bags
P4-50 Sensitivity Analysis 3
+
+
LL
Transcribed Image Text:Open recovered workbooks? Your recent changes were saved. B10 X ✓ fx A B C D E F 1 Selling oranges and orange juice 2 3 Revenues, variable costs 4 5 Revenue 6 Variable cost 7 Available 45 8 91012311516 $2.00 $1.20 Grades used to make juice and bags Grade Juice 6 9 Sold 14 Required average quality 17 18 Quality constraints 19 20 Actual 21 22 Required 23 24 Total variable cost 25 Total revenue 26 27 Profit 28 29 Ready 188 Bags P4-50 Model Juice Juice Juice $2.25 $1.35 Bags Bags Used Bags P4-50 Sensitivity Analysis 3 + + LL
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