Finding objective function for the problem

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Reference no: EM13105630

A company makes products A and B from 2 resources, labor and material. The company wants to determine the selling price which will maximize profits. A unit of product A costs 25 to make and demand is estimated to be 20 - .10 * Price of A. A unit of product B costs 18 to make and demand is estimated to be 30 - .07 * Price of B. The utilization of labor and materials and the available quantity of resources is shown in the table. A reasonable price for the products is between 100 and 200.

Product	A	B	Available resources
Labor (hr/unit)	3	2	150
Material (ounces/unit)	1	2	200
Manufacturing cost($/unit)	25	18
Demand (units)	20 - 0.10*P₁	30 - 0.07*P₂

Let X₁ = demand for As and X₂ = demand for Bs.

Let P₁ = price for As and P₂ = price for Bs.

What is the objective function for this problem?

Reference no: EM13105630

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