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Natasha's Flowers, a local florist, purchases fresh flowers each day at the local flower market. The buyer has a budget of $980 per day to

Natasha's Flowers, a local florist, purchases fresh flowers each day at the local flower market. The buyer has a budget of $980

per day to spend. Different flowers have different profit margins, and also a maximum amount the shop can sell. Based on past experience the shop has estimated the following NPV of purchasing each type:

NPV per

bunch

Cost per

bunch

Max.

Bunches

Roses $2 $23 25
Lilies $9 $25 10
Pansies $5 $33 10
Orchids $20 $80 5

What combination of flowers should the shop purchase each day?

Question content area bottom

Part 1

The profitability index for each choice is: (Round to three decimal places.)

NPV per

bunch

Cost per

bunch

Max.

Bunches

Profitability Index

(per bunch)

Roses $2 $23 25 enter your response here

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