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Exercise 2. Your company has been hired as the exclusive food provider for the Yellow Jackets, a local AA baseball team. As manager, you decide

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Exercise 2. Your company has been hired as the exclusive food provider for the Yellow Jackets, a local AA baseball team. As manager, you decide how many corndogs, nachos, and hamburgers to make. You've decided to set the prices for these goods at $3.00, $8.00, and $5.00 respectively. Based on last year, you've determined that corndogs require 10 minutes of labor, nachos require 5 minutes of labor, and hamburgers require 8 minutes of labor (You make everything from scratch, so this includes prep time and clean-up). Since the team only plays three games a week, you can only hire 4 hours of labor per game. This means you'll get 240 minutes of labor (60 * 4 = 240). Since you are just starting out, you only have 2 grills and 4 fryers to work with. Each grill can hold 5 burgers and each fryer can hold either 5 servings of nacho chips or 5 corndogs. This means your grill capacity is 10 (5*2 = 10), and total fryer capacity is 20 (5*4 = 20). a) Using Solver, calculate the optimal profit level. b) How many of each item do you produce? How much profit did you make? c) You received enough of a tax break to buy one more grill or one more fryer. Which do you choose? Explain your reasoning. Hint: Look at the Shadow Price/Lagrange Multiplier on the Sensitivity Report. d) After the first month of business, the owner of the team has asked you for a favor. He loves corndogs, so he wants to make sure there are at least 6 corndogs made per game. Re-run Solver and determine how much of each you will now make. e) Finally, there has been a shortage of cheese. This means that you can only make 3 nachos per game. Re-run Solver with this new information. How many of each good do you produce now? ) How much profit did you lose from the cheese shortage? Exercise 2. Your company has been hired as the exclusive food provider for the Yellow Jackets, a local AA baseball team. As manager, you decide how many corndogs, nachos, and hamburgers to make. You've decided to set the prices for these goods at $3.00, $8.00, and $5.00 respectively. Based on last year, you've determined that corndogs require 10 minutes of labor, nachos require 5 minutes of labor, and hamburgers require 8 minutes of labor (You make everything from scratch, so this includes prep time and clean-up). Since the team only plays three games a week, you can only hire 4 hours of labor per game. This means you'll get 240 minutes of labor (60 * 4 = 240). Since you are just starting out, you only have 2 grills and 4 fryers to work with. Each grill can hold 5 burgers and each fryer can hold either 5 servings of nacho chips or 5 corndogs. This means your grill capacity is 10 (5*2 = 10), and total fryer capacity is 20 (5*4 = 20). a) Using Solver, calculate the optimal profit level. b) How many of each item do you produce? How much profit did you make? c) You received enough of a tax break to buy one more grill or one more fryer. Which do you choose? Explain your reasoning. Hint: Look at the Shadow Price/Lagrange Multiplier on the Sensitivity Report. d) After the first month of business, the owner of the team has asked you for a favor. He loves corndogs, so he wants to make sure there are at least 6 corndogs made per game. Re-run Solver and determine how much of each you will now make. e) Finally, there has been a shortage of cheese. This means that you can only make 3 nachos per game. Re-run Solver with this new information. How many of each good do you produce now? ) How much profit did you lose from the cheese shortage

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