Question
4. Consider a firm called ABC that manufactures four products using three resources. The relevant X data is as follows. Dual values are shadow prices.
4. Consider a firm called ABC that manufactures four products using three resources. The relevant X data is as follows. Dual values are shadow prices. Answer to the following questions using the computer output. (total 20 pts) Resource consumption per unit produced Resource Product 1 Product2 Product3 Product4 availabilities Resoucel 3 11 9 1 95 Resource2 Resource3 Unit profit 10 7 4 72 2 5 12 6 81 $50 $20 $30 $40 A. Suppose that another firm called XYZ wishes to "buy out" ABC, that is, XYZ wishes to purchase all ABC's resources for its own use. Considering the total available quantities of resource 1, 2, 3, what will be the minimal payment that XYZ should offer to ABC? (10 pts) B. XYZ offers $4.5 to buying one unit of resources 2. How many units of resources 2 shall ABC sell them to XYZ? (5pts) C. XYZ wants to buy 10 units of resources 1. What is XYZ's minimal price offer for one unit of resource 1 to persuade ABC? (5pts) Variable X1 X1 x2 X3 X4 RHS Dual X2 X3 Value Reduced Cost 4.82 0. 0. 18.2143 5.95 0. Original Val Lower Bound Upper Bound 50. 43.89 75. 20. -Infinity 38.21 30. 20 300. Maximize 50. 20. 30. 40. X4 0. Constraint 1 3. 11. 9. 1
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