An oil and gas company has two refineries that produce light and heavy crude oil. The first
Question:
An oil and gas company has two refineries that produce light and heavy crude oil. The first refinery can produce 500 barrels of light crude oil and 300 barrels of heavy crude oil per day, and the second refinery can produce 600 barrels of light crude oil and 450 barrels of heavy crude oil per day. The daily operating cost of each refinery is $15,000 and $20,000, respectively. The company has to fulfill production orders totaling 3,200 barrels of light crude oil and 2,100 barrels of heavy crude oil. Analyze the information and recommend an appropriate production plan. Consider a situation where the orders for light and heavy crude oil change (e.g., an increase or decrease by 15%) and its impact on your production plan.
Step by Step Answer:
Business Analytics
ISBN: 9781265897109
2nd Edition
Authors: Sanjiv Jaggia, Alison Kelly, Kevin Lertwachara, Leida Chen