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Question 2 (Investing & Marketing Problem): Barstool publishes two types of guides on a monthly basis: a sport events guide and a frozen pizza guide.
Question 2 (Investing \& Marketing Problem): Barstool publishes two types of guides on a monthly basis: a sport events guide and a frozen pizza guide. Barstool distributes the guides free to businesses, hotels, and stores. The company's profits come exclusively from the paid advertising in the guides. - Each of the sport events guides distributed generates $0.50 per guide in advertising revenue, whereas the frozen pizza guide generates $0.75 per guide. - The frozen pizza guide is a more sophisticated publication that includes color photos, and accordingly it costs $0.25 per guide to print, compared with only $0.17 for the sport events guide. - The publishing company has a printing budget of $4,000 per month. - There is enough rack space to distribute at most 18,000 guides each month. - To entice businesses to place advertisements, Barstool promises to distribute at least 8,000 copies of each guide. The company wants to determine the number of copies of each guide it should print each month to maximize advertising revenue, Formulate a linear programming model for this problem. a) Solve the linear programming model formulation with Excel solver. b) Determine the sensitivity range for the advertising revenue generated by the frozen pizza guide. c) Does the company spend all of its printing budget? If not, how much slack is left over? d) What would be the effect on the optimal solution if the frozen pizza companies insisted that 12,000 copies of the frozen pizza guide be distributed instead of the current 8,000 copies, or they would withdraw their advertising? e) How much would it be worth to Barstool to obtain enough additional rack space to distribute 18,500 copies instead of the current 18,000 copies? 20,000 copies? f) How much would it be worth to Barstool to reduce the requirement to distribute the entertainment guide from 8,000 to 7,000 copies
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