Reference no: EM132833591

Woodcut manufactures tables and chairs. Each table and chair must be made entirely out of oak or entirely out of pine. A total of 150 board feet of oak and 210 board feet of pine are available. A table requires either 17 board feet of oak or 30 board feet of pine, and a chair requires either 5 board feet of oak or 13 board feet of pine. Each table can be sold for $40 and each chair for $15.

Required:

Problem 1. Determine how Woodco can maximize its revenue.

Problem 2. Perform a sensitivity analysis using the standard Excel-Solver reports and interpret the results for the reduced cost and the shadow price. (Please remember to provide a complete explanation for these parameters.) You should use a text box, in the worksheet showing the sensitivity report, for your explanation. (Ensure that the text box is no more than 5 columns in width.)