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The Amorco Oil Company controls two oil fields. Field 1 can produce up to 20 million barrels of oil per day, and field 2 can

The Amorco Oil Company controls two oil fields. Field 1 can produce up to 20 million barrels of oil per day, and field 2 can produce up to 15 million barrels of oil per day. At field 1, it costs $37.50 to extract and refine a barrel of oil; at field 2 the cost is $41.20. Amorco sells oil to two countries: United Kingdom and Japan. The shipping costs per barrel are shown in the table. Each day, the United Kingdom is willing to buy up to 10 million barrels at $65.80 per barrel, and Japan is willing to buy up to 25 million barrels at $68.40 per barrel. Determine how to maximize Amorco's profit.

Cost per barrel of shipping

U.K.

Japan

Field 1

$5.50

$6.80

Field 2

$4.20

$5.30

  1. Solve this problem using the regular model.
  2. Solve this problem using the alternative model.

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