Find the optimal amounts and solve the dual problem, Macroeconomics

After some consultants point out that the Acme Toy Company has two bottlenecks in its production of xylophones and yo-yos. The first is a critical grinding machine that only has 9 hours of capacity per day. The second is warehouse space which is limited to 10 (thousand) square feet. Each production run of xylophones requires 3 hours of grinding and take up two thousand square feet of storage while each yo-yo run requires one hour of grinding time and takes up 2000 square feet of storage. Each run of xylophones contributes $4 (thousand) to overhead and profit while each run of yo-yos contributes $2 (thousand).

  1. Find the optimal amounts of each kind of toy to produce using graphical methods.
  2. State and solve the dual problem graphically.
  3. Now solve the problem using the revised simplex method. Do you get the same answers?
  4. How much would the firm be willing to pay to increase the capacity of the grinding machine?

 

Posted Date: 3/7/2013 12:12:42 AM | Location : United States







Related Discussions:- Find the optimal amounts and solve the dual problem, Assignment Help, Ask Question on Find the optimal amounts and solve the dual problem, Get Answer, Expert's Help, Find the optimal amounts and solve the dual problem Discussions

Write discussion on Find the optimal amounts and solve the dual problem
Your posts are moderated
Related Questions
reason why the change in equilibrium of output is greater than the change in initial invest ..

An investment promised a payoff of $195 two and a half years from today. At a discount rate of 75% per year what is the present value of this investment? A. 169.47 B. Not enoug

what are the factors that shift the LM curve what is the real interest rate and the nominal interest rate. what is expected rate of inflation why has the real interest rate that cl

A local movie theater wants to know how much popcorn they should stock for a given movie showing. Records from 94 movies reveal a mean of 57 boxes and a standard deviation of 17.8.

You are given the following information about an economy: Gross Investment  =                                                         40 Govt. purchases of goods & service =

Overnight interest rate of Central banks When the central bank buys government securities, it purchases from many individuals, companies and institutions. Deposits and reserves

What is the marginal product? The marginal product of an input is the extra quantity of output which is generated by using one more unit of which input. Marginal product of

Index number formulas

Q. What is money and what is not money? If you are trying to conclude if something is money, basically consider whether it would be accepted in most stores as payment. Then you

Consider two consumers, A and B. A and B both want perfect consumption smoothing (c = cf) and both have no current wealth. However, the two consumers have different income streams.