Question
Blue Ridge Power Company has a maximum capacity of 2.5 million kilowatt-hours (kWh) of electric power available daily. The demand (in millions of kWh) for
Blue Ridge Power Company has a maximum capacity of 2.5 million kilowatt-hours (kWh) of electric power available daily. The demand (in millions of kWh) for power from its customers for high-demand (peak) hours and low-demand (off-peak) hours is determined by the following formulas: highdemand:5.8 - 0.06ph + 0.005pl lowdemand:3.0 - 0.11pl + 0.008ph The variable P1 equals the price per kilowatt-hour during low-demand hours, and Ph is the price per kilowatt-hour during high-demand (peak) hours. Formulate and solve a nonlinear programming model to determine the price structure (per kWh) that will maximize revenue.
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