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2. Best Wishes Company is a mail order company that delivers gift baskets for businesses and individuals. They currently offer four different kinds of
2. Best Wishes Company is a mail order company that delivers gift baskets for businesses and individuals. They currently offer four different kinds of gourmet cheese gift baskets: "Four- Cheese", "Cheddars", "Party Box" and "Nachos Blend". Each of these different gift baskets comprises a different combination of four cheeses: Mild Cheddar, Sharp Cheddar, Swiss, and Monterey Jack. A fixed number of ounces of each of these cheeses are available to make up the baskets. The company has used a linear optimization model to determine how many baskets of each type to produce in order to maximize total profit. The model was solved using Excel and the Sensitivity Report is shown below. Answer the following questions using the sensitivity report. (If a question can't be answered using the sensitivity report say so. You don't need to change the model and solve it.) Microsoft Excel 11.0 Sensitivity Report Adjustable Cells Final Value Reduced Cost Objective Coefficient Allowable Allowable Cell Name Increase Decrease -0.001 0.001 7.99 $C$17 Four-Cheese 6.99 23.437 59.375 18.75 1E+30 0.010 0.005 $D$17 Cheddars 7.99 SE$17 Party Box SF$17 Nachos Blend 5.99 1.335 8.99 5.988 0.003 Constraints Constraint R.H. Side Allowable Increase Final Shadow Allowable Cell Name Value Price Decrease $K$10 Mild Cheddar 500 0.748 0.250 0.000 0.749 500 150 316.667 1E+30 250 SK$11 Sharp Cheddar SKS12 Swiss 300 237.5 300 150 450 350 212.5 150 SK$13 Monterey Jack 350 250 a) What is the optimal amount to produce of each basket? b) What will Best Wishes' profit be? c) If Party Box baskets earned $6.99 instead of $5.99, what would the resulting profit be? d) If Party Box baskets earned $4.99 instead of $5.99, what would the resulting profit be? e) What are the non-binding constraints and how much slack is there in each? f) How much more would Best Wishes earn if they had 80 additional ounces of Mild Cheddar? g) If 120 ounces of the Mild Cheddar spoiled and became unusable, how would it affect the company's profits? h) If 200 ounces of Swiss spoiled and became unusable, how would it affect the company's profits?
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