Raw-Materials (lbs) Products Availabilit
Taco Loco is considering a new addition to their
X Y Z y
menu. They have test marketed a number of
possibilities and narrowed them down to three Beef 4 3 2 28
new products, X, Y, and Z. Each of these products Cheese 11 8 9 80
is made from a different combination of beef, Beans 2 4 4 68
beans, and cheese, and each product has a price point. Taco Loco feels they can sell an X for $17, a Y for
$13, and a Z for $14. To produce this product the requirements and availability of raw-materials are
shown in the table.
1. As a MIS consultant of the company formulates the following linear programming model.
Objective Function: Max R = 14Z + 13Y + 17X; subject to: (i) Beef 2Z + 3Y + 4X ≤ 28 (ii) Cheese
9Z + 8Y + 11X ≤ 80 (iii) Beans 4Z + 4Y + 2X ≤ 68 (iv) X,Y,Z ≥ 0
2. Solve the model using appropriate software and interpret the report
The sensitivity report from the computer model reads as follows:
# Question Answer
1 The optimum mixture of the product
2 Total profit at this mix
3 What value of objective function would include X in the optimum mix
4 Objective coefficient will not change the optimum value of Z
5 If Z is increased by 1 unit what will be the ultimate effect on profit
6 If x is increased by 1 unit what will be the ultimate effect on profit
7 Taco Loco should try to purchase additional _ but should not buy
more_ .
8 Taco Loco should produce both ___ but should not make any ___.
9 Taco Loco will make the same quantity of X, Y, and Z if the amount
of cheese at their disposal is between __ pounds and __ pounds.
1 For humanitarian reasons, Taco Loco decides they would rather make
0 product X than product Y. The dollar amount that they can both
increase the price of Y and reduce the price of X by to accomplish this
reversal of demand is ________.
1 If Taco Loco reduces the price of the X product by about 82 cents, then
1 their optimal product mix will contain ________ X.
1 Which constraint(s) is/ are binding?
2
Which constraint(s) is/ are slack(s)?