Blue Ridge Power Company has a maximum capacity of 2.5 million kilowatt-hours (kWh) of electric power available on a daily basis. The demand (in millions of kWh) for power from its customers for high-demand (peak) hours and low-demand (off-peak) hours is determined by the following formulas:
high demand: 5.8 - 0.06ph + 0.005pl
low demand: 3.0 - 0.11pl + 0.008ph

The variable pl equals the price per kilowatt-hour during low-demand hours, and ph is the price per kilowatt-hour during high-demand (peak) hours.
Formulate and solve a nonlinear programming model to determine the price structure (per kWh) that will maximize revenue.

  • CreatedJuly 17, 2014
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