When Molly Lai purchased the Clean Clothes Corner Laundry, she thought that because it was in a good location near several high-income neighborhoods, she would automatically generate good business if she improved the laun- dry’s physical appearance. Thus, she initially invested a lot of her cash reserves in remodeling the exterior and interior of the laundry. However, she just about broke even in the year following her acquisition of the laundry, which she didn’t feel was a sufficient return, given how hard she had worked. Molly didn’t realize that the dry-cleaning business is very competitive and that success is based more on price and quality service, including quickness of service, than on the laundry’s appearance. In order to improve her service, Molly is considering purchasing new dry-cleaning equipment, including a press- ing machine that could substantially increase the speed at which she can dry-clean clothes and improve their appear- ance. The new machinery costs $16,200 installed and can clean 40 clothes items per hour (or 320 items per day). Molly estimates her variable costs to be $0.25 per item drycleaned, which will not change if she purchases the new equipment. Her current fixed costs are $1,700 per month. She charges customers $1.10 per clothing item. A. What is Molly’s current monthly volume? B. If Molly purchases the new equipment, how many additional items will she have to dry-clean each month to break even? C. Molly estimates that with the new equipment she can increase her volume to 4,300 items per month. What monthly profit would she realize with that level of business during the next 3 years? After 3 years? D. Molly believes that if she doesn’t buy the new equip- ment but lowers her price to $0.99 per item, she will increase her business volume. If she lowers her price, what will her new break-even volume be? If her price reduction results in a monthly volume of 3,800 items, what will her monthly profit be? E. Molly estimates that if she purchases the new equipment and lowers her price to $0.99 per item, her volume will increase to about 4,700 units per month. Based on the local market, that is the largest volume she can realistically expect. What should Molly do?
> A truck manufacturer has three manufacturing plants and four retail outlets. The details of the demand at outlets, supply at plants, and the cost to transport between plants and outlets in lakhs (a lakh is a unit in the Indian numbering system equal to o
> Customers call an airline call center to book seats. There are three divisions in the airline call center, one for booking first class seats, one for booking business class seats, and one for booking economy class seats. Each call center agent attends ca
> Solve Problem 55 in Chapter 3 as an integer programming model using the computer.
> The Reliance Manufacturing Company produces an aircraft part. The company can produce the part entirely at a flexible work center with multiple computerized machines. The company has four work centers, all of which are different because they were purchas
> The Skimmer Boat Company manufactures three kinds of molded fiberglass recreational boats— a bass fishing boat, a ski boat, and a speedboat. The profit for a bass boat is $20,500, the profit for a ski boat is $12,000, and the profit for a speedboat is $2
> The Metropolitan Police Department was recently criticized in the local media for not responding to police calls in the downtown area rapidly enough. In several recent cases, alarms had sounded for break-ins, but by the time the police car arrived, the p
> Six Sigma is a well-recognized quality management system that employs improvement projects to improve business processes to reduce product and service defects, reduce costs, and increase profits. Each project has a “championâ€
> The Suntrek Company is a global apparel retailer with stores around the world. It manufactures many of its clothing items in China and transports them by rail and truck to four ports on the coast—Hong Kong, Shenzhen, Yangshen, and Qingd
> The Jacobsons in Problem 24 have been approached by a home furnishings company that needs a wooden stool for its catalog. The company has asked the Jacobsons to produce a batch of 20 wooden stools, and the Jacobsons would realize a profit of $65 for each
> Harry and Melissa Jacobson produce handcrafted furniture in a workshop on their farm. They have obtained a load of 600 board feet of birch from a neighbor and are planning to produce round kitchen tables and ladder-back chairs during the next 3 months. E
> A welder fabricates steel doors, gates, and tables using cutting and welding machines. He has 200 units of steel, 630 processing hours of cutting machine, and 600 hours of welding machine. He earns a profit of £750 from a door, £
> Brenda Last, an undergraduate business major at State University, is attempting to determine her course schedule for the fall semester. She is considering seven 3-credit-hour courses, which are shown in the following table. Also included are the average
> A farmer owns 150 acres of land and plans to sow wheat, rice, and corn. He can use the storage facility of the government but must reserve the space before planting crops. He receives water free from the public canal. For planning purposes, the farmer mu
> The Terraco Motor Company has produced a lightweight, all-terrain vehicle code-named “J99 Terra” for the military. The company is now planning to sell the Terra to the public. It has five plants that manufacture the ve
> A family has some rose plants in its garden. The family wants to use a fertilizer in their garden. To prepare the fertilizer, the family needs to blend two chemicals (1 and 2). These chemicals provide the required nutrients for the roses. The prominent n
> A political party wants to campaign for the forthcoming elections. The party has planned to allocate party volunteers to the four constituencies the party plans to contest in. Each volunteer visits his/her assigned constituency, meets voters, and seeks v
> Draper, where Tech is located, does not have a commercial airport; instead residents who are flying on an airline must travel to the airport in Roanoke 40 miles away. The town council is considering a joint economic development plan with the local Chambe
> Juan Hernandez, a Cuban athlete who visits the United States and Europe frequently, is allowed to return with a limited number of consumer items not generally available in Cuba. The items, which are carried in a duffel bag, cannot exceed a weight of 5 po
> The Metropolitan Arts Council (MAC) wants to advertise its upcoming season of plays, concerts, and ballets. A television commercial that costs $25,000 will supposedly reach 53,000 potential arts customers. The breakdown of the audience is as follows: A n
> The athletic boosters club for Beaconville has planned a 2-day fund-raising drive to purchase uniforms for all the local high schools and to improve facilities. Donations will be solicited during the day and night by telephone and personal contact. The b
> Mazy’s Department Store has decided to stay open for business on a 24-hour basis. The store manager has divided the 24-hour day into six 4-hour periods and has determined the following minimum personnel requirements for each period: Sto
> Working part-time in a restaurant near his university, Sabastian expects to earn €2,000 during his three-month summer vacation. He plans to invest his hard-earned money in the available investment products. Each option has certain minimu
> In the example problem solution for this chapter on page 232, a textbook company was attempting to determine how many sales representatives to assign to each of two new regions. The company has now decided that if any sales representatives are assigned t
> A jewelry store makes necklaces and bracelets from gold and platinum. The store has 20 ounces of gold and 20 ounces of platinum. Each necklace requires 5 ounces of gold and 2 ounces of platinum, whereas each bracelet requires 2 ounces of gold and 4 ounce
> The owner of the Consolidated Machine Shop has $10,000 available to purchase a lathe, a press, a grinder, or some combination thereof. The following 0–1 integer linear programming model has been developed to determine which of the three
> Lauren Moore has sold her business for $500,000 and wants to invest in condominium units (which she intends to rent) and land (which she will lease to a farmer). She estimates that she will receive an annual return of $8,000 for each condominium and $6,0
> An interior design and construction company produces two types of tiles—floor tiles and wall tiles. Floor tiles are made with slightly rough surface to make it nonslippery, whereas wall tiles are given a smooth and mirror finish. The company currently us
> The town of Draper, with a population of 20,000, sits adjacent to State University, which has an enrollment of 27,000 students. Downtown Draper merchants have long complained about the lack of parking available to their customers. This is one primary rea
> Lakeside Boatworks is planning to manufacture three types of molded fiberglass recreational boats—a fishing (bass) boat, a ski boat, and a small speedboat. The estimated selling price and variable cost for each type of boat are summariz
> A hospital dietitian prepares breakfast menus every morning for the hospital patients. Part of the dietitian’s responsibility is to make sure that minimum daily requirements for vitamins A and B are met. At the same time, the cost of th
> On their farm, the Friendly family grows apples that they harvest each fall and make into three products—apple butter, applesauce, and apple jelly. They sell these three items at several local grocery stores, at craft fairs in the region, and at their ow
> Two coffee house chains, Startrak and Mill Mountain, dominate the Columbus market. Startrak has developed three new marketing strategies, 1, 2, and 3, for the fall season, which include various combinations of media and print advertising, and promotions.
> In the event of a disaster situation at Tech from weather, an accident, or terrorism, victims will be transported by emergency vehicles to three area hospitals: Montgomery Regional, Radford Memorial, and Lewis Galt. Montgomery Regional is (on average) 10
> A car manufacturer has production plants in Germany, the United Kingdom, and France, and it exports cars to several other countries. The manufacturer’s supply chain includes manufacturers, distributors, and retailers. The plant in Germa
> The National Cereal Company produces a Light-Snak cereal package with a selection of small pouches of four different cereals—Crunchies, Toasties, Snakmix, and Granolies. Each cereal is produced at a different production facility and the
> Air Jet operates flights between Delhi and Darjeeling, a tourist destination, which takes approximately 2 hours. Pilots report to duty based on where they were hired. For example, if a pilot, David, was hired by the Delhi branch of the airline, then he s
> The city of Salem has four police stations, with the following inputs and outputs: The monthly output and input data for each station are Help the city council determine which of the police stations are relatively inefficient.
> A water theme park plays seven games depending on the demand during weekdays and weekends. The park earns revenues (in thousands of euros) from playing these games and the revenue varies with the days. Certain games generate more revenue during weekends
> Vicki Smith, Penny Miller, and Darryl Davis are students at State University. In the summer, they often go rafting with other students down the Ocobee River in the nearby Blue Ridge Mountain foothills. The river has a number of minor rapids but is not ge
> Blue Ridge Power and Light Company generates electrical power at four coal-fired power plants along the eastern seaboard in Virginia, North Carolina, Maryland, and Delaware. The company purchases coal from six producers in southwestern Virginia, West Vir
> For the blend example in this chapter, if the requirement that “at least 3,000 barrels of each grade of motor oil” was changed to exactly 3,000 barrels of each grade, how would this affect the optimal solution? If the company could acquire more of one of
> In Problem 58, Great Northwoods Outfitters is going to alter its staffing policy. Instead of hiring a constant group of full-time operators for the entire 8-week planning period, it has decided to hire and add full-time operators as the 8-week period pro
> Great Northwoods Outfitters is a retail phone-catalog company that specializes in outdoor clothing and equipment. A phone station at the company will be staffed with either full-time operators or temporary operators 8 hours per day. Full-time operators,
> Venture Systems is a consulting firm that develops e-commerce systems and Web sites for its clients. It has six available consultants and eight client projects under contract. The consultants have different technical abilities and experience, and as a re
> Mazy’s Department Store has decided to stay open on a 24-hour basis. The store manager has divided the 24-hour day into six 4-hour periods and determined the following minimum personnel requirements for each period: Personnel must repor
> The White Horse Apple Products Company purchases apples from local growers and makes applesauce and apple juice. It costs $0.60 to produce a jar of applesauce and $0.85 to produce a bottle of apple juice. The company has a policy that at least 30% but no
> Ahmed owns camels and sells camel milk in cans. A can will hold 3 liters of milk. To market his products, he brands his products as High-Vitamin and Low-Fat. Camel milk is processed with liquid-based vitamins, and fats and are packed in his farm. From hi
> Eyewitness News is shown on channel 5 Monday through Friday evenings from 5:00 p.M. to 6:00 p.M. During the hour-long broadcast, 18 minutes are allocated to commercials. The remaining 42 minutes of airtime are allocated to single or multiple time segment
> A ship has two cargo holds, one fore and one aft. The fore cargo hold has a weight capacity of 70,000 pounds and a volume capacity of 30,000 cubic feet. The aft hold has a weight capacity of 90,000 pounds and a volume capacity of 40,000 cubic feet. The s
> The Goliath Tool and Machine Shop produces a single product that consists of three subcomponents that are assembled to form the product. The three components are manufactured in an operation that involves two lathes and three presses. The production time
> In Problem 49, the optimal solution results in a fractional (i.e., noninteger) number of lawyers being hired. Explain how you would go about logically determining a new solution with a whole (integer) number of lawyers being hired, and discuss the differ
> For the transportation example in this chapter, suppose that televisions not shipped were to incur storage costs of $9 at Cincinnati, $6 at Atlanta, and $7 at Pittsburgh. How would these storage costs be reflected in the linear programming model for this
> The law firm of Smith, Smith, Smith, and Jones is recruiting at law schools for new lawyers for the coming year. The firm has developed the following estimate of the number of hours of casework it will need its new lawyers to handle each month for the fo
> Managers at the Transcontinent Shipping and Supply Company want to know the maximum tonnage of goods they can transport from city A to city F. The firm can contract for railroad cars on different rail routes linking these cities via several intermediate
> Carillon Health Systems owns three hospitals, and it wants to determine which, if any, of the hospitals are inefficient. The hospital inputs each month are (1) hospital beds (100s), (2) non- physician labor (1,000s hrs.), and (3) dollar value of supplies
> Tidewater City Bank has four branches with the following inputs and outputs: The monthly output and input values for each bank are as follows: Using data envelopment analysis (DEA), determine which banks, if any, are inefficient.
> The manager of the Ewing and Barnes Department Store has four employees available to assign to three departments in the store—lamps, sporting goods, and linens. The manager wants each of these departments to have at least one employee,
> The production manager of Videotechnics Company is attempting to determine the upcoming 5-month production schedule for video recorders. Past production records indicate that 2,000 recorders can be produced per month. An additional 600 recorders can be p
> The Jones, Jones, Smith, and Rodman commodities trading firm knows the prices at which it will be able to buy and sell a certain commodity during the next 4 months. The buying price (ci) and selling price (pi) for each of the given months (i) are as foll
> A pottery company produces three types of products from clay: dining ware, sanitary ware, and floor tiles. The company has a stock of 500 kg of clay. A dining ware needs 2 kg of clay, sanitary ware, 4 kg, and tiles, 1 kg. The oven has space for 200 items
> An investment firm has $1 million to invest in stocks, bonds, certificates of deposit, and real estate. The firm wishes to determine the mix of investments that will maximize the cash value at the end of 6 years. Opportunities to invest in stocks and bon
> The Cash and Carry Building Supply Company has received the following order for boards in three lengths: The company has 25-foot standard-length boards in stock. Therefore, the standard-length boards must be cut into the lengths necessary to meet order r
> A maintenance section of a leading property company installs appliances for free in its residential and commercial properties. Whoever rents the properties can avail the free service only once at the time of moving in. After installation and during the r
> For the marketing example in this chapter, if the budget is increased by $20,000, how much will audience exposures be increased? If Biggs Department Store wanted the same total number of people exposed to each of the three types of advertisements, how sh
> A refinery blends four petroleum components into three grades of gasoline—regular, premium, and diesel. The maximum quantities available of each component and the cost per barrel are as follows: To ensure that each gasoline grade retain
> Suzuki Motors is a leading car manufacturer in India manufacturing cars at its Gurgaon facility. Suzuki Motors has manufactured 500 cars. These cars are to be transported to its customers in Vizag and Chennai. Four hundred cars are ordered from Chennai
> The admissions office at State University wants to develop a planning model for next year’s entering freshman class. The university has 4,500 available openings for freshmen. Tuition is $8,600 for an in-state student and $19,200 for an
> A manufacturer of bathroom fixtures produces fiberglass bathtubs in an assembly operation that consists of three processes—molding, smoothing, and painting. The number of units that can undergo each process in an hour is as follows: (No
> Dr. Maureen Becker, the head administrator at Jefferson County Regional Hospital, must determine a schedule for nurses to make sure there are enough of them on duty throughout the day. During the day, the demand for nurses varies. Maureen has broken the
> Green Valley Mills produces carpet at plants in St. Louis and Richmond. The plants ship the carpet to two outlets in Chicago and Atlanta. The cost per ton of shipping carpet from each of the two plants to the two warehouses is as follows: The plant at St
> Melissa Beadle is a student at Tech, and she wants to decide how many hours each day to allocate to the following activities: class; studying; leisure and fun stuff; personal activities such as eating, bathing, cleaning, laundry, and so on; and sleeping.
> Joe Henderson runs a small metal parts shop. The shop contains three machines—a drill press, a lathe, and a grinder. Joe has three operators, each certified to work on all three machines. However, each operator performs better on some m
> A confectionary store is producing two types of candies: Bulk chocolate and Mini sticks candies. Both of these candies use chocolate liquor, butter, and sugar. Currently the store has 25 lb of chocolate liquor, 16 lb of butter, and 80 lb of sugar. Candie
> The Skimmer Boat Company manufactures the Water Skimmer bass fishing boat. The company purchases the engines it installs in its boats from the Mar-gine Company, which specializes in marine engines. Skimmer has the following production schedule for April,
> In the investment example in this chapter, how would the solution be affected if the requirement that the entire $70,000 be invested was relaxed such that it is the maximum amount available for investment? If the entire amount available for investment do
> Toyz is a large discount toy store in Valley Wood Mall. The store typically has slow sales in the summer months that increase dramatically and rise to a peak at Christmas. During the summer and fall, the store must build up its inventory to have enough s
> The Mill Mountain Coffee Shop blends coffee on the premises for its customers. It sells three basic blends in 1-pound bags: Special, Mountain Dark, and Mill Regular. It uses four different types of coffee to produce the blends—Brazilian
> An apparel company wants to popularize its products by contacting its prospective customers. The company sets a target of contacting at least 500 men, 400 women, 300 children, and 420 schools. The company incurs £1.5 to make a daytime call a
> A furniture company produces tables, chairs, and sofas. The company uses lumber, fabric, and glass to produce these products. Labor performs the cutting, sanding, and assembly operations. The following table provides the resouce requirents of products. T
> The honorary business fraternity at Tech is planning an all-day bake sale on Saturday of a home football game as a charity fund-raising project. The members will bake cakes, cup- cakes, and cookies in one member’s apartment oven starting at 5 p.M. on Fri
> Alexis is in the first year of her undergraduate program. Her father has contributed £25,000 toward her education. From this amount she must pay her tuition for the first three years and she expects a tuition waiver for the fourth year. Since she wants t
> Gobblecakes is a bakery that specializes in cupcakes. The annual fixed cost to make cupcakes is $18,000. The variable cost including ingredients and labor to make a cupcake is $0.90. The bakery sells cupcakes for $3.20 apiece. a. If the bakery sells 12,0
> David wants to be an entrepreneur after his graduation. He is interested in toy manufacturing. After conducting market research, he estimates that his initial investment to buy brand-new toy production equipment will be $30,000; whereas for each toy, he
> The United Charities annual fund-raising drive is scheduled to take place next week. Donations are collected during the day and night, by telephone, and through personal contact. The average donation resulting from each type of contact is as follows: The
> The Southfork Feed Company makes a feed mix from four ingredients—oats, corn, soybeans, and a vitamin supplement. The company has 300 pounds of oats, 400 pounds of corn, 200 pounds of soybeans, and 100 pounds of vitamin supplement available for the mix.
> The head of the Department of Business Analytics at Tech is determining faculty teaching schedules for the department’s 10 faculty members for next semester. There are 20 course sections scheduled over six 75-minute class periods on Tue
> Brooks City has three consolidated high schools, each with a capacity of 1,200 students. The school board has partitioned the city into five busing districts—north, south, east, west, and central—each with different hi
> In the diet example in this chapter, what would be the effect on the optimal solution of increasing the minimum calorie requirement for the breakfast to 500 calories? To 600 calories? Increase the breakfast calorie requirement to 700 calories, and reform
> Ampco is a manufacturing company that has a contract to supply a customer with parts from April through September. However, Ampco does not have enough storage space to store the parts during this period, so it needs to lease extra warehouse space during
> A fast food restaurant in Dubai needs white and dark meat to produce patties and burgers. Cost of a kg of white meat is AED10 and dark meat is AED7. Patties must contain exactly 60% white meat and 40% dark meat. A burger should contain at least 30% white
> The Midland Tool Shop has four heavy presses it uses to stamp out prefabricated metal covers and housings for electronic consumer products. All four presses operate differently and are of different sizes. Currently the firm has a contract to produce thre
> Anna Broderick is the dietitian for the State University football team, and she is attempting to determine a nutritious lunch menu for the team. She has set the following nutritional guidelines for each lunch serving: ● Between 1,500 an
> As a result of a recently passed bill, a congressman’s district has been allocated $4 million for programs and projects. It is up to the congressman to decide how to distribute the money. The congressman has decided to allocate the mone
> The Willow Furniture Company produces tables. The fixed monthly cost of production is $8,000, and the variable cost per table is $65. The tables sell for $180 apiece. a. For a monthly volume of 300 tables, determine the total cost, total revenue, and pro
> Alexandra Bergson has subdivided her 2,000-acre farm into three plots and has contracted with three local farm families to operate the plots. She has instructed each sharecropper to plant three crops: corn, peas, and soybeans. The size of each plot has b
> Lawns Unlimited is a lawn care and maintenance company. One of its services is to seed new lawns as well as bare or damaged areas in established lawns. The company uses three basic grass seed mixes it calls Home 1, Home 2, and Commercial 3. It uses three
> A greenhouse farmer plans to grow three crops—cucumber, potato, and tomato—in the forth- coming season in his farm, which spans 60 hectares. Each crop requires nitrogen, phosphoros, potassium, and micronutrients. The r
> The Roadnet Transport Company expanded its shipping capacity by purchasing 90 trailer trucks from a bankrupt competitor. The company subsequently located 30 of the purchased trucks at each of its shipping warehouses in Charlotte, Memphis, and Louisville.
> Grafton Metalworks Company produces metal alloys from six different ores it mines. The company has an order from a customer to produce an alloy that contains four metals accord- ing to the following specifications: at least 21% of metal A, no more than 1
> In the product mix example in this chapter, Quick-Screen is considering adding some extra operators who would reduce processing times for each of the four clothing items by 10%. This would also increase the cost of each item by 10% and thus reduce unit p
