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Question - Sidneyville manufactures household and commercial furnishings. The Office Division produces two types of desks, rolltop and regular. Sidneyville constructs the desks in its plant outside Medford, Oregon from a selection of woods. The woods are cut to a uniform thickness of one inch. For this reason, one measures the wood in units of square feet. One rolltop desk requires 10 square feet of pine, 4 square feet of cedar, and 15 square feet of maple. One regular desk requires 20 square feet of pine, 16 square feet of cedar, and 10 square feet of maple. The desks yield respectively $115 and $90 profit per sale. At the current time, the firm has available 200 square feet of pine, 128 square feet of cedar, and 220 square feet of maple. They would like to produce the number of rolltop and regular desks that would maximize profit.
a) Formulate the above problem as a Linear Programming problem with the objective of maximizing profit?
b) Solve the above problem graphically using corner point method?
Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?
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