Formulate and solve slide 8 and 9 form the Prep Linear & Integer Programming power point, use solver to solve, but make sure you formulate and write down that formulation before solving.

X1 = Dollars invested in Signature Loans

X2 = Dollars invested in Furniture Loans

X3 = Dollars invested in Second Home Mortgages

X4 = Dollars invested in First Home Mortgages

MAX dollar return: .15X1 + .12X2 + .10X3 + .07X4

Signature loan limit: X1

Signature & Furniture loan limit: X1 + X2

1st mortgage limit: X4 >= .40(X3 + X4)

1st to-total limit: X4 >= .20(X1 + X2 + X3 + X4)

Available funds: X1 + X2 + X3 + X4

Non-negativity constraint: X1 , X2 , X3 , X4 >= 0

Signature loan limit: -.90X1 + .10X2 + .10X3 + .10X4 >= 0

Signature & Furniture loan limit: -.80X1 -.80X2 + .20X3 + .20X4>= 0

1st mortgage limit: .40X3 -.60X4

1st to-total limit: .20X1 + .20X2 + .20X3 -.80X4

Available funds: X1 + X2 + X3 + X4

Non-negativity constraint: X1 , X2 , X3 , X4 >= 0

X1 = pounds of ST to produce at Fresno plant

X2 = pounds of ST to produce at Dearborn plant

X3 = pounds of GG to produce at Fresno plant

X4 = pounds of GG to produce at Dearborn plant

Max ($9-$2)X1 + ($9-$4)X2 + ($7-$2)X3 + ($7-$3)X4

Subject to

Fresno capacity: X1 + X3

Dearborn capacity: X2 + X4

ST daily demand: X1 + X2

GG daily demand: X3 + X4

KFC budget: $2X1 + $4X2 +$2X3 + $3X4

X1, X2, X3, X4 >= 0

What is the maximum daily profit potential for KFC

What daily production plan should KFC perform to max profits

Will run Promotion and drop price to $6 at Fresno plant, what will profit be for each pro day

What happens if management makes a decision to produce both fertilizers at both plants to increase customer service.

LP Example III Production Scheduling Kalo Fertilizer Company (KFC) produces two brands of lawn fertilizer Super Two OST) and Green Grow (GG) at plants in Fresno, CA and Dearborn, MI. The Fresno plant has resources to product 5,000lbs of fertilizer daily, the Dearborn plant has resources to produce 6,000lbs daily. The cost per pound of producing each brand at each plant is: Fresno Dearborn ST 52 54 GG $3 KFC has a daily budget of $45,000 for both plants. Based on past sales, the maximum daily demands is 6,000lbs for ST and 7,000lbs for GG. The selling price is $9/lb ST and $7/lb GG. The company wants to know the number of pounds of each brand of fertilizer to produce at each plant in order to maximize profit