Minimizes the cost of meeting company daily demands

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A chemical company manufactures three chemicals: A, B, and C. These chemicals are produced via two production processes: 1 and 2. Running process 1 for an hour costs $400 and yields 300 units of A, 100 units of B, and 100 units of C. Running process 2 for an hour costs $100 and yields 100 units of A and 100 units of B. To meet customer demands, at least 1000 units of A, 500 units of B, and 300 units of C must be produced daily.

1. Use Solver to determine a daily production plan that minimizes the cost of meeting the company’s daily demands.

2. Use a solver of your choice to see what happens to the decision variables and the total cost when the hourly processing cost for process 2 increases in increments of $0.50. How large must this cost increase be before the decision variables change? What happens when it continues to increase beyond this point? (hint: reduced cost may help to answer this question.)

Reference no: EM132221261

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