6 Steelco uses coal, iron, and labor to produce three types of steel. The inputs (and sales price) for one ton of each type of steel are shown in Table 8. Up to 200 tons of coal can be purchased at a price of $10 per ton. Up to 60 tons of iron can be purchased at $8 per ton, and up to 100 labor hours can be purchased at $5 per hour. Let x1 = tons of steel 1 produced; x2 = tons of steel 2 produced; and x3 =

tons of steel 3 produced.

The LINDO output that yields a maximum profit for the company is given in Figure 11. Use the output to answer the following questions.
a What would profit be if only 40 tons of iron could be purchased?

b What is the smallest price per ton for steel 3 that would make it desirable to produce it?
c Find the new optimal solution if steel 1 sold for $55 per ton.

Transcribed Image Text:

Plant 1 2 Labor Needed (Hours) 16 2600 3 10 Raw Material Needed (Units) Production Cast ($) 5 587 50 80 100