Chandler Oil Company has 5,000 barrels of oil 1 and10,000 barrels of oil 2. The company sells two products:gasoline and heating oil. Both products are produced bycombining oil 1 and oil 2. The quality level of each oil isas follows: oil 1—10; oil 2—5. Gasoline must have anaverage quality level of at least 8, and heating oil at least 6.Demand for each product must be created by advertising.Each dollar spent advertising gasoline creates 5 barrels ofdemand and each spent on heating oil creates 10 barrels ofdemand. Gasoline is sold for $25 per barrel, heating oil for$20. Formulate an LP to help Chandler maximize profit.Assume that no oil of either type can be purchased.

Chandler Oil Company has 5,000 barrels of oil 1 and10,000 barrels of oil 2. The company sells two products:gasoline and heating oil. Both products are produced bycombining oil 1 and oil 2. The quality level of each oil isas follows: oil 1—10; oil 2—5. Gasoline must have anaverage quality level of at least 8, and heating oil at least 6.Demand for each product must be created by advertising.Each dollar spent advertising gasoline creates 5 barrels ofdemand and each spent on heating oil creates 10 barrels ofdemand. Gasoline is sold for $25 per barrel, heating oil for$20. Formulate an LP to help Chandler maximize profit.Assume that no oil of either type can be purchased.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 33P: Assume the demand for a companys drug Wozac during the current year is 50,000, and assume demand...

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