Refer to Example A.4.
1. Solve this blending problem using Excel Solver. What are the optimum solution values?

2. Interpret the €œallowable increase€ and €œallowable decrease€ values for the objective function coefficients.

3. Interpret the values of the shadow prices and the €œallowable increase€ and €œallowable decrease€ values for the righthand- side values of the constraints.

Data from Example 4

Sai Coffee Shop sells its customers two blends of coffee to its customers: regular blend and premium blend. The shop uses three different types of coffee beans to produce these blends: 

Hawaiian, Ethiopian, and Colombian. The mixing requirements for each blend, their revenues per pound of sales, and the costs per pound of the different types of beans are given in the following table. Customer demand per week is at least 120 pounds for the regular blend and 100 pounds for the premium blend. If the shop€™s objective is to maximize the total profits from the sales of the different blends of coffee, formulate the problem as a linear programming problem:

Transcribed Image Text:

REVENUE/ BLEND BLENDING REQUIREMENTS POUND $7.00 Regular At least 40% Ethiopian, at most 20% Colombian, and no more than 30% Hawaiian Premium $9.00 At least 25% Hawaiian, at least 25% Ethiopian, and at least 30% Colombian COST/POUND BEANS Hawaian $4.00 $5.00 Ethiopian Colombian $6.00