Question
Problem 4 (15 points): Morbid Mortuary comes to you with...well...a somewhat morbid problem. The company has purchased land to create a new cemetery and
Problem 4 (15 points): Morbid Mortuary comes to you with...well...a somewhat morbid problem. The company has purchased land to create a new cemetery and the owner knows that you are versed in how to maximize profits for a company. The company offers three different types of gravesites: standard, deluxe, and monuments. Here is the information the company provides you about each of the three sites: Standard Deluxe Monuments Sales price $600 $1,000 $5,000 Variable cost per unit $350 $450 Square feet of space needed 12 16 $4,000 40 The company would like to offer all three types of gravesite, and to ensure that it wants to make sure that no more than 50% of the new cemetery is any one type of site, and that each site has availability of at least 10% of the cemetery. The cemetery is 10,000 square feet in area. The company believes maximum demand for each type of site for this area is 800 standard, 300 deluxe, and 100 monuments. Provide Morbid Mortuary with the product mix of gravesites that will maximize the company's profits given the above constraints. (Hint: think carefully about when you need to round up vs. round down to meet the constraints in this case.)
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