Viking Oil Company has 5,000 barrels of oil 1 and 10,000 barrels of oil 2. The comany sells two products: gasoline and heating oil. Both products are produced by combining oil 1 and oil 2. The quality level of each oil is as follows: oil 1: 10, oil 2: 5. Gasoline must have an average quality level of at least 8, and heating oil at least 6. Demand for each product must be created by advertising. Each dollar spent advertising gasoline creates 5 barrels of gasoline demand. Each dollar spent advertising heating oil creates 10 barrels of heating oil demand. Gasoline is sold for $25 per barrel, heating oil for $20 per barrel. Formulate an LP to help Viking Oil maximize profit. Remember, profit = revenue - costs. Explain what your variables represent, and how you arrived at your constraints, and then solve this LP
Viking Oil Company has 5,000 barrels of oil 1 and 10,000 barrels of oil
2. The comany sells two products: gasoline and heating oil. Both products
are produced by combining oil 1 and oil 2. The quality level of each oil is
as follows: oil 1: 10, oil 2: 5. Gasoline must have an average quality level
of at least 8, and heating oil at least 6. Demand for each product must
be created by advertising. Each dollar spent advertising gasoline creates
5 barrels of gasoline demand. Each dollar spent advertising heating oil
creates 10 barrels of heating oil demand. Gasoline is sold for $25 per
barrel, heating oil for $20 per barrel. Formulate an LP to help Viking Oil
maximize profit. Remember, profit = revenue - costs. Explain what your
variables represent, and how you arrived at your constraints, and then
solve this LP
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