Management Science Case Problems

1. Bark's Pet Food Company produces canned cat food called Meow Chow and canned dog
food called Bow Chow. The company produces the pet food from horse meat, ground
fish, and a cereal additive. Each week the company has 600 pounds of horse meat, 800
pounds of ground fish, and 1,000 pounds of cereal additive available to produce both
kinds of pet food. Meow Chow must be at least half fish, and Bow Chow must be at least
half horse meat. The company has 2,250 16-ounce cans available each week. A can of
Meow Chow earns $0.80 in profit, and a can of Bow Chow earns $0.96 in profit. The
company wants to know how many cans of Meow Chow and Bow Chow to produce
each week in order to maximize profit.

a. Formulate a linear programming model for this problem.

b. Solve the model.

2. A petroleum company produces three grades of motor oil super, premium, and extra
from three components. The company wants to determine the optimal mix of the three
components in each grade of motor oil that will maximize profit. The maximum
quantities available of each component and their cost per barrel are as follows:

Maximum Barrels
Component Available / Day Cost / Barrel
1 4,500 $12
2 2,700 10
3 3,500 14

To ensure the appropriate blend, each grade has certain general specifications. Each
grade must have a minimum amount of component 1 plus a combination of other
components, as follows:

Component
Grade Specifications Selling Price / Barrel
Super At least 50% of 1 $23
Not more than 30% of 2
Premium At least 40% of 1 20
Not more than 25% of 2
Extra At least 60% of 1 18
At least 10% of 2

The company wants to produce at least 3,000 barrels of each grade of motor oil.
3. The Biggs Department Store chain has hired an advertising firm to determine the types
and amount of advertising it should invest in for its stores. The three types of advertising
available are television and radio commercials and newspaper ads. The retail chain
desires to know the number of each type of advertisement it should purchase in order
to maximize exposure. It is estimated that each ad or commercial will reach the
following potential audience and cost the following amount:

Exposure (people/ad or
commercial) Cost
Television Commercial 20,000 $15,000
Radio Commercial 12,000 6,000
Newspaper Ad 9,000 4,000

The company must consider the following resource constraints:

1. The budget limit for advertising is $100,000.
2. The television station has time available for 4 commercials.
3. The radio station has time available for 10 commercials.
4. The newspaper has space available for 7 ads.
5. The advertising agency has time and staff available for producing no more
than a total of 15 commercials and/or ads.
4. Frijo-Lane Food Products own farms in the Southwest and Midwest, where it grows
and harvests potatoes. It then ships these potatoes to three processing plants in
Atlanta, Baton Rouge, and Chicago, where different varieties of potato products,
including chips, are produced. Recently, the company has experienced a growth in its
product demand, so it wants to buy one or more new farms to produce more potato
products.
The company is considering six new farms with the following annual fixed costs and
projected harvest:

Projected Annual
Fixed annual cost Harvest (thousands of
Farm ($1,000s) tons)
1 $ 405 11.2
2 390 10.5
3 450 12.8
4 368 9.3
 5 520 10.8
6 465 9.6
The company currently has the following additional available production capacity (tons)
at its three plants, which it wants to utilize:

Plant Available Capacity (thousands of tons)

A 12
B 10
C 14

The shipping costs ($) per ton from the farms being considered for purchase to the
plants are as follows:

Plant (shipping costs, $/ton)

Farm A B C
1 18 15 12
2 13 10 17
3 16 14 18
4 19 15 16
5 17 19 12
6 14 16 12

The company wants to know which of the six farms it should purchase to meet available
production capacity at the minimum total cost, including annual fixed costs and shipping
costs.