Essentials of Business Analytics (MindTap Course List)
2nd Edition
ISBN: 9781305627734
Author: Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher: Cengage Learning
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Textbook Question
Chapter 13, Problem 1P
GreenLawns provides a lawn fertilizing and weed control service. The company is adding a special aeration treatment as a low-cost extra service option that it hopes will help attract new customers. Management is planning to promote this new service in two media: radio and direct-mail advertising. A media budget of $3,000 is available for this promotional campaign. Based on past experience in promoting its other services, GreenLawns has obtained the following estimate of the relationship between sales and the amount spent on promotion in these two media:
where
S = total sales in thousands of dollars
R = thousands of dollars spent on radio advertising
M = thousands of dollars spent on direct-mail advertising
GreenLawns would like to develop a promotional strategy that will lead to maximum sales subject to the restriction provided by the media budget.
- a. What is the value of sales if $2,000 is spent on radio advertising and $1,000 is spent on direct-mail advertising?
- b. Formulate an optimization problem that can be solved to maximize sales subject to the media budget of spending no more than $3,000 on total advertising.
- c. Determine the optimal amount to spend on radio and direct-mail advertising. How much in sales will be generated?
a.
Expert Solution
To determine
To find the amount of sales generated when $2,000 and $1,000 is spend on radio and direct-mail advertising.
Explanation of Solution
To find the amount of sales generated, substitute $2,000 and $1,000 is spend on radio and direct-mail advertising in the below relationship equation.
Therefore, sales of $36,000 will be generated with the budget allocated for promotion.
b.
Expert Solution
To determine
To formulate optimization problem to maximize sales when total advertising cost is not more than $3,000.
Explanation of Solution
The formulation is for the problem is shown below,
c.
Expert Solution
To determine
To solve and find the optimal amount to be spend on advertising to determine the amount of sales generated.
Explanation of Solution
Formula:
Solver:
Output:
The solution is R = $2,500 and M = $500 with Sales of $37,000
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Please answer C. and D.
Palisades Eco-Park is a small ecological reserve that admits a relatively small number of visitors on any day, but provides both educational and entertaining lectures, exhibitions, and opportunities to observe nature. The company has collected the following data on labor costs and number of visitors to the park over the last 30 months.
Month
Labor Cost
Visitors
1
$
25,820
1,700
2
$
36,290
2,592
3
$
39,968
2,811
4
$
31,648
2,222
5
$
34,809
2,373
6
$
32,672
2,181
7
$
32,023
2,205
8
$
38,334
2,676
9
$
38,568
2,760
10
$
46,933
3,572
11
$
42,157
2,976
12
$
39,030
2,804
13
$
34,444
2,415
14
$
33,173
2,336
15
$
36,971
2,508
16
$
26,500
2,099
17
$
30,663
3,397
18
$
29,961
2,786
19
$
27,590
2,412
20
$
30,003
2,972
21
$
25,692
2,000
22
$
24,655
1,794
23
$
28,892
3,267
24
$
30,153
3,817
25
$
28,119
2,592
26
$
31,690
3,274
27
$
28,651
2,989
28
$
29,927
3,050
29
$
28,438
2,511
30
$
27,874
2,075…
Spring is a peak time for selling houses. Suppose the data below contains the selling price, number of bathrooms, square footage, and number of bedrooms of 26 homes sold in Ft. Thomas, Kentucky, in spring 2018.
Selling Price Baths Sq Ft
Selling Price
160,000
170,000
178,000
182,500
195,100
212,500
245,900
250,000
255,000
258,000
267,000
268,000
275,000
1.5 1,786
2 1,768
1 1,219
1 1,578
1.5 1,125
2 1,196
2 2,128
N W
3
2
1,280
1,596
3.5 2,374
2.5 2,439
2 1,470
2 1,688
Beds
3
3
3
2
3
2
3
3
3
4
3
4
4
295,000
325,000
325,000
328,400
331,000
344,500
365,000
385,000
395,000
399,000
430,000
430,000
454,000
Baths Sq Ft
2.5 1,860
3 2,056
3.5 2,776
2
1,408
1.5 1,972
2.5 1,736
2.5 1,990
2.5 3,640
2.5 1,928
2 2,108
2
2,462
2 2,615
3.5 3,700
Beds
3
4
4
4
3
3
4
4
4
3
4
4
4
Consider the estimated regression equation we developed that can be used to predict the selling price given the number of bathrooms, square footage, and number of bedrooms in the house. (x, denotes number of bathrooms, x₂ denotes…
United Dairies, Inc., supplies milk to several independent grocers throughout Dade County, Florida. Managers at United Dairies want to develop a forecast of the number of half-gallons of milk sold per week. Sales data for the past 12 weeks follow and have been transferred in the data file UDFMilk.xlsx download(also posted under week 11 module).
Week
Sales
Week
Sales
1
2750
7
3300
2
3100
8
3100
3
3250
9
2950
4
2800
10
3000
5
2900
11
3200
6
3050
12
3150
By Thursday, April 15 (11:55pm PST), answer the following 2 questions and attach a word doc or excel file to show your work.
Use the data in the file UDFMilk.xlsx downloadto construct a time series plot. What type of pattern exists in the data?
Use exponential smoothing with to develop a forecast of demand for week 13.
Chapter 13 Solutions
Essentials of Business Analytics (MindTap Course List)
Ch. 13 - GreenLawns provides a lawn fertilizing and weed...Ch. 13 - The Cobb-Douglas production function is a classic...Ch. 13 - Let S represent the amount of steel produced (in...Ch. 13 - The profit function for two products is:...Ch. 13 - Jims Camera shop sells two high-end cameras, the...Ch. 13 - Heller Manufacturing has two production facilities...Ch. 13 - Andalus Furniture Company has two manufacturing...Ch. 13 - Phillips Inc. produces two distinct products, A...
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