The Production Manager for the Whoppy Soft Drink Company Is

question 87

Short Answer

The production manager for the Whoppy soft drink company is considering the production of two kinds of soft drinks: regular (R) and diet (D). The company operates one 8-hour shift per day. Therefore, the production time is 480 minutes per day. During the production process, one of the main ingredients, syrup, is limited to maximum production capacity of 675 gallons per day. Production of a regular case requires 2 minutes and 5 gallons of syrup, while production of a diet case needs 4 minutes and 3 gallons of syrup. Profits for regular soft drink are $3.00 per case and profits for diet soft drink are $2.00 per case.
The formulation for this problem is given below.
MAX Z = $3R + $2D
s.t.
   2R + 4D ? 480
   5R + 3D ? 675
The sensitivity report is given below.
Adjustable Cells
$\begin{array}{lcccccc}\text { Cell } & \text { Name } & \begin{array}{c}\text { Final } \\\text { Value }\end{array} & \begin{array}{c}\text { Reduced } \\\text { Cost }\end{array} & \begin{array}{c}\text { Objective } \\\text { Coefficient }\end{array} & \begin{array}{c}\text { Allowable } \\\text { Increase }\end{array} & \begin{array}{c}\text { Allowable } \\\text { Decrease }\end{array} \\\hline \$ \mathrm{~B} \$ 6 && \text { Regular }=90.00 & 0.00 & 3 & 0.33 & 2 \\\hline \$ \mathrm{C} \$ 6 && \text { Diet }=75.00 & 0.00 & 2 & 4 & 0.2 \\\hline\end{array}$ Constraints
$\begin{array}{ccccccc}\text { Cell } & \text { Name } & \begin{array}{c}\text { Final } \\\text { Value }\end{array} & \begin{array}{c}\text { Shadow } \\\text { Price }\end{array} & \begin{array}{c}\text { Constraint } \\\text { R.H. Side }\end{array} & \begin{array}{c}\text { Allowable } \\\text { Increase }\end{array} & \begin{array}{c}\text { Allowable } \\\text { Decrease }\end{array} \\\hline\$ \mathrm{E} \$ 3 & \text { Production (minutes) } & 480.00 & 0.07 & 480 & 420 & 210 \\\hline \$\text { E } \$ 4 & \text { Syrup (gallons) } & 675.00 & 0.57 & 675 & 525 & 315 \\\hline\end{array}$
-What is the optimal daily profit?

Understand the concept and importance of a global marketing approach for luxury items.

Comprehend the characteristics and implementation of a global business strategy.

Grasp the essence and application of a multidomestic strategy.

Understand the differences between a global marketing approach and a multidomestic strategy.

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Definitions:

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price within a specified period.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, with elasticity greater than one indicating a high responsiveness.

Sales

The total number of goods or services sold within a specific time period.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, indicating its sensitivity to price changes.