Question 2 2.5 pts Tasamo makes two types of vehicle-SUV and Pickup Truck. These

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Question 2 2.5 pts Tasamo makes two types of vehicle-SUV and Pickup Truck. These vehicles require three types of special materials: material A material B material C. Each SUV requires 30 pounds of material A, 20 pounds of material B, and 50 pounds of material C. Each Pickup Truck requires 30 pounds of material A, 40 pounds of material B, and 80 pounds of material C. The profit for each SUV is $3000 and the profit for each Pickup Truck is $5500. Due to suppliers capacity limits, Tony can only obtain 6000 pounds of material A, 5000 pounds of material B, and 6500 pounds of material C per month. Tasamo also needs to produce at least 50 SUV per month to fulfilla contract. Tasamo wants to find a production plan (ie, the number of SUV and Pickup Truck to make) to maximize his monthly profit. Let x be the number of SUV to make per month. Let y be the number of Pickup Truck to make per month. Tasamo has formulated this decision problem as a linear program and solved it with Excel Solver. Tasamo obtained the following report from Excel Solver Variable Cells Final Reduced Objective Allowable Allowable Value Cost Coefficient Increase Decrease 250 2500 lueCost Coefficient 3000 Cell Name $C$2 Decision Variable X 150 SD$2 Decision Variable y 50 0 0 5500 500 2500

Explanation / Answer

From the solver solution the number of SUV's is to be made = 150 pieces and the number of pick ups to be made = 50 units, The profit from SUV is $3000 and from Pick up is $ 5500.

So, the maximum profit = 150*$3000+50*$5500 = $450,000+$275,000 = $725,000

b) When Profit Becoms $2700,

The shadow price of a SUV is $16.66 . This means, if the price is decreased by below $16.66, the objective functions will decrease and production function will change. If the profit is increased beyonf of $16.66 , the objective function will increase and production function will also change accordingly.

In this case profit function is decreased by $300, (From $3000 to $ 2700 ) is more than $ 16.66 , the prodcution function and objective function will change.

Question c, Don't Know.

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