Sells two types of gasoline-regular and premium

Assignment Help Operation Management

Reference no: EM13991236

Reef's Petroleum Company sells two types of gasoline: Regular and Premium. RPC pays $2.00 for each gallon of regular gasoline and $2.20 for each gallon of Premium gasoline that it sells. The owner's son, Luke Reef, and MBA student at the University of Alabama, has already analyzed the company's sales and price data. He discovered that the demand for each type of gasoline is influenced by its own price as well as by the price of the other type of gasoline. Luke has estimated that the weekly demand for each type of gasoline can be approximated by the following formulas: Regular Demand=10,000-3,000xregularprice+150 x Premium price, Premium Demand=8,000+50xregularprice-2,200x premium price. Draw an influence chart for this problem and construct a spreadsheet model to analyze this problem. Use $2.50 and $2.70 as the base case selling prices for the Regular and Premium gasoline, respectively

Reference no: EM13991236

Questions Cloud

Why can this building be considered modern : work will be evaluated for the clarity of the structure, the logic in the development of your argument, and the thoroughness with which you discuss the important point

Thinking about the concept of liability of foreignness : Thinking about the concept of liability of foreignness, what would you consider to be BYD’s greatest challenge when attempting to compete successfully in the U.S. market? How would you address these challenges?

Determining the greatest overall tax benefits : Ricardo asks you to evaluate these options and advise him on the tax conse- quences of each. Write a letter to Ricardo explaining the tax effects of each option. Include your recommendation of the option that provides the greatest overall tax bene..

Electron transport occurs in : In eukaryotes, electron transport occurs in? A.membranes and mitochondria

Sells two types of gasoline-regular and premium : Reef's Petroleum Company sells two types of gasoline: Regular and Premium. RPC pays $2.00 for each gallon of regular gasoline and $2.20 for each gallon of Premium gasoline that it sells. The owner's son, Luke Reef, and MBA student at the University o..

Problem regarding the greatest after-tax return : Assume that Zane is a 28% marginal tax rate payer, the time value of money is 6%, and Zane intends to hold any amounts invested for 5 years. Which option will provide the greatest after-tax return, ignoring state income tax implications? Would you..

What are the levels of organization of multicellular organis : What are the levels of organization of multicellular organisms? (largest to smallest)

Determining the effects of alternate methods of transferring : Discuss the tax effects of alternate methods of transferring $20,000 to Alex, and devise an optimal plan for making the transfer.

Forecast equally or better than computers using heuristics : Are highly experienced managers able to forecast equally or better than computers using heuristics? Given your answer to the above question, what are the implications for the role of managers and computers in forecasting?

User Account

All Pages