Question
Given the sensitivity report below, please answer the following questions. Please let me know if I should provide anything else. Thanks. 4. Suppose that the
Given the sensitivity report below, please answer the following questions. Please let me know if I should provide anything else. Thanks.
4. Suppose that the Market Research Department feels it could increase demand for juice by 25,000 cases by means of advertising campaign. How much should Red Brand be willing to pay for such a campaign? Justify.
5. Suppose an additional lot of grade B tomatoes is available. The lot is 50,000 pounds. How much should Red Brand be willing to pay for this lot of grade B tomatoes? Justify.
6. Suppose that the selling price of juice increased by 10 cents per case. Using the sensitivity Report, tell whether the optimal production plan will change. Justify.
7. Would you recommend the purchase of additional tomatoes of grade A (up to 80,000 pounds)? If so, what would be the NET impact on profit of these additional 80,000 pounds of tomatoes of grade A? Justify your answers.
8. Using your answer to the preceding question, reformulate the model with the additional 80,000 pounds of tomatoes, solve the reformulated model, and indicate how the additional tomatoes will be used.
Microsoft Excel 16.30 Sensitivity Report Worksheet: Case Study.xlsx]Sheet1 Report Created: 2020-02-26 1:27:37 AM Variable Cells Final Allowable Reduced Cost Objective Coefficient Allowable Increase Cell Name Value Decrease Produced x1 0 0 $E$6 $F$6 525000 175000 0.08222222 .08222222 Produced x2 0 0 $G$6 Produced x3 75000 0.066 0.066 .1543703733 0.02162962667 0.46311112 0.02162962667 0.02162962667 0.1543703733 0.01432098667 0.05145679111 0.03244444 1E+30 1E+300 .01611111 Produced x4 225000 $H$6 $1$6 $J$6 0 Produced x5 Produced x6 -0.03244444 0 0.074 0.074 2000000 Constraints Final Value Shadow Price Constraint R.H. Side Allowable Decrease Cell Name 3000000 $K$11 $K$12 $K$13 $K$14 600000 Quantity Constraint LHS Availability Constraint 1 LHS Availability Constraint 2 LHS Demand Constraint 1 LHS Allowable Increase 1E+30 0 0 3000000 600000 2400000 0.09033333 0.05788889 466666.6667 200000 2400000 700000 14400000 1E+30 0 1E+30 300000 2000000 1000000 2000000 0.01611111 200000 $K$15 $K$16 $K$17 $K$18 Demand Constraint 2 LHS Demand Constraint 3 LHS Quality Constraint 1 LHS Quality Constraint 2 LHS 13700000 700000 466666.6667 600000 200000 -0.00811111 -0.00811111 466666.6667 1400000 0 Microsoft Excel 16.30 Sensitivity Report Worksheet: Case Study.xlsx]Sheet1 Report Created: 2020-02-26 1:27:37 AM Variable Cells Final Allowable Reduced Cost Objective Coefficient Allowable Increase Cell Name Value Decrease Produced x1 0 0 $E$6 $F$6 525000 175000 0.08222222 .08222222 Produced x2 0 0 $G$6 Produced x3 75000 0.066 0.066 .1543703733 0.02162962667 0.46311112 0.02162962667 0.02162962667 0.1543703733 0.01432098667 0.05145679111 0.03244444 1E+30 1E+300 .01611111 Produced x4 225000 $H$6 $1$6 $J$6 0 Produced x5 Produced x6 -0.03244444 0 0.074 0.074 2000000 Constraints Final Value Shadow Price Constraint R.H. Side Allowable Decrease Cell Name 3000000 $K$11 $K$12 $K$13 $K$14 600000 Quantity Constraint LHS Availability Constraint 1 LHS Availability Constraint 2 LHS Demand Constraint 1 LHS Allowable Increase 1E+30 0 0 3000000 600000 2400000 0.09033333 0.05788889 466666.6667 200000 2400000 700000 14400000 1E+30 0 1E+30 300000 2000000 1000000 2000000 0.01611111 200000 $K$15 $K$16 $K$17 $K$18 Demand Constraint 2 LHS Demand Constraint 3 LHS Quality Constraint 1 LHS Quality Constraint 2 LHS 13700000 700000 466666.6667 600000 200000 -0.00811111 -0.00811111 466666.6667 1400000 0Step by Step Solution
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