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Orange Company is allocating its advertising budget for its new smartphone targeting graduate and undergraduate students in RTP. The company has invited representatives from the

  1. Orange Company is allocating its advertising budget for its new smartphone targeting graduate and undergraduate students in RTP. The company has invited representatives from the local radio station, television station, and newspaper to make presentations in which they describe their audiences. The television station representative indicates that a TV commercial, which costs $15,000, would reach 25,000 potential customers per ad. The breakdown of the audience is as follows:

Male Female
Graduate 5,000 5,000
Undergraduate 5,000 10,000

The newspaper representative claims to be able to provide an audience of 10,000 potential customers at a cost of $4,000 per ad. The breakdown of the audience is as follows:

Male Female
Graduate 4,000 3,000
Undergraduate 2,000 1,000

The radio station representative says that every radio commercial has an audience of 15,000 at a cost of $7,000. The breakdown of the audience is as follows.

Male Female
Graduate 1,500 1,500
Undergraduate 4,500 7,500

Orange Company has the following advertising policy:

  • The number of radio commercials must be at least twice the number of newspaper ads.
  • The advertising campaign must reach at least 80,000 customers.
  • The size of the undergraduate audience must be at least twice the size of the graduate audience.
  • Make sure that at least 40% of the audience is female.
  • Available space limits the number of newspaper ads to at most two.

Orange Company wants to know the optimal number of each type of advertising to purchase to minimize total cost.

  1. Formulate a linear programming model to determine the company's advertising strategy. (24pts)
  2. Solve the model using Excel Solver. (2pts)

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