Chapter 3.11, Problem 7P

Explanation of Solution

Linear Programming (LP) to determine the monthly payment:

• Assume the following,
  • Let “${\text{Up}}_{\text{m}}$” be the unpaid balance after month “m” payment.
  • Let “p” be the payment that can be paid on month.
• The conditions to this model are as follows,
  • All variables >= “0”.
  • “${\text{Up}}_1=1000-(\text{p}-0.01(1000))$” that denotes the unpaid balance after month “1” payment.
  • For “$\text{n=1,2,}\mathrm{}$