A beer company has divided Bloomington into twoterritories. If x1 dollars are spent on promotion in territory1, then 6x1/21 cases of beer can be sold there; and if x2 dollarsare spent on promotion in territory 2, then 4x1/22 cases ofbeer can be sold there. Each case of beer sold in territory 1sells for $10 and incurs $5 in shipping and production costs.Each case of beer sold in territory 2 sells for $9 and incurs$4 in shipping and production costs. A total of $100 isavailable for promotion. How can the beer companymaximize profits? If an extra dollar could be spent onpromotion, by approximately how much would profitsincrease? By how much would revenues increase?
A beer company has divided Bloomington into twoterritories. If x1 dollars are spent on promotion in territory1, then 6x1/21 cases of beer can be sold there; and if x2 dollarsare spent on promotion in territory 2, then 4x1/22 cases ofbeer can be sold there. Each case of beer sold in territory 1sells for $10 and incurs $5 in shipping and production costs.Each case of beer sold in territory 2 sells for $9 and incurs$4 in shipping and production costs. A total of $100 isavailable for promotion. How can the beer companymaximize profits? If an extra dollar could be spent onpromotion, by approximately how much would profitsincrease? By how much would revenues increase?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Question
A beer company has divided Bloomington into two
territories. If x1 dollars are spent on promotion in territory
1, then 6x1/2
1 cases of beer can be sold there; and if x2 dollars
are spent on promotion in territory 2, then 4x1/2
2 cases of
beer can be sold there. Each case of beer sold in territory 1
sells for $10 and incurs $5 in shipping and production costs.Each case of beer sold in territory 2 sells for $9 and incurs
$4 in shipping and production costs. A total of $100 is
available for promotion. How can the beer company
maximize profits? If an extra dollar could be spent on
promotion, by approximately how much would profits
increase? By how much would revenues increase?
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