Operations Management
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                Assignment 3: LP  Problems
                      Date: Tuseday, September 26, 00
              Due: Tuseday, October 3, 00 (beginning of class)

• write an algebraic linear program, with variables clearly defined, and constraints explained
• solve with SOLVER
• select in the sensitivity report
• a reduced cost (if there is a non-zero, otherwise a zero)
• a shadow price
• an allowable increase and decrease of an objective coefficient
• an allowable increase and decrease of a R.H. Side
and explain, in terms of the problem you solved.

1   A farmer can grow Alfalfa and Corn on available (paid for) land of 10 acres. Each crop requires a monetary input (for seeds, fertilizers, labor, etc.)  as follows: An acre Alfalfa requires $100, and an acre Corn requires $50. The farmer has a total budget of $1000. The expected revenues are: $500 from an acre of Alfalfa, and $250 from an acre Corn.

• Formulate an LP to allocate the land to Alfalfa and Corn so as to maximize profit.
• Solve graphically and by SOLVER.
• How much should the farmer pay (maximum buying price) for an additional acre? for an additional dollar?
• If the farmer wants to trade his resources, how much should he ask (mimimum selling price) for one acre? for one dollar?

3   Text, p. 94, Problem 24