A Developer Wishes to Expand an Office Complex and Needs

question 38

Essay

A developer wishes to expand an office complex and needs to determine how many small,medium,and large offices to include in the expansion.Each small office requires 400 square feet,each medium office requires 700 square feet,and each large office requires 1200 square feet.The current square footage available for expansion is 35,000 square feet.The developer expects to pay $10,000 for each small office,$20,000 for each medium office,and $35,000 for each large office.The developer wishes to limit his expenditures to $500,000.How many of each type of office should be built if the following goals,stated in no particular order,must be met?
Goal 1: The expansion should include approximately 6 small offices.
Goal 2: The expansion should include approximately 11 medium offices.
Goal 3: The expansion should include approximately 15 large offices.
Goal 4: The expansion should consist of approximately 35,000 square feet.
Goal 5: The expansion should cost approximately $500,000.

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Definitions:

Sales-oriented

Pertains to a business approach focused primarily on sales volume as the chief measure of success, often at the expense of customer satisfaction or product quality.

Lifetime Profitability

Refers to the total net profit a company expects to earn over the entirety of its business relationship with a customer.

Relationship Value

The perceived worth or benefits derived from maintaining a long-term relationship with a customer or business partner.

Lifetime Profitability

The total net profit a company expects to earn over the duration of its entire business relationship with a customer.