Phillips Inc. produces two distinct products, A and B. The products do not compete with each other
Question:
Annual profit for product A = 1.2712 LN (XA) 1 17.414
Annual profit for product B = 0.3970 LN(XB) 1 16.109 where XA and XB are the advertising amount allocated to products A and B, respectively, in thousands of dollars, profit is in millions of dollars, and LN is the natural logarithm function. The advertising budget is $500,000, and management has dictated that at least $50,000 must be allocated to each of the two products.
a. Build an optimization model that will prescribe how Phillips should allocate its marketing budget to maximize profit.
b. Solve the model you constructed in part a using Excel Solver.
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Related Book For
Essentials of Business Analytics
ISBN: 978-1285187273
1st edition
Authors: Jeffrey Camm, James Cochran, Michael Fry, Jeffrey Ohlmann, David Anderson, Dennis Sweeney, Thomas Williams
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