The Marketing Club on campus sells three popular mixed soda drinks on campus to raise funds. The

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The Marketing Club on campus sells three popular mixed soda drinks on campus to raise funds. The drinks are simple mixed blends of pure flavors of grape, orange, and cherry soda. “Starburst” comprises 50% orange, 25% grape, and 25% cherry. “Morning Delight” comprises 75% orange and 25% grape. “Cherry Surprise” comprises 80% cherry, 10% orange, and 10% grape. Based on past demand, the club sets prices of its one-liter products at $2.75 for Starburst, $3.00 for Morning Delight, and $2.00 for Cherry Surprise. On any given sales day (football game days), the club can sell all that it produces, but the supplies are limited. The club receives the pure flavors (and one-liter bottles) free as a donation from a loyal alumnus, who provides 100 liters of grape, 150 liters of cherry, and 250 liters of orange soda before each football game.

(a) Determine the best product mix for the Marketing Club.

(b) Suppose that the loyal donor loves the Morning Delight beverage and wants more customers to try it. She requests that the price for Morning Delight be reduced to $2.40 to entice even higher demand for that flavor. Resolve the Excel model. What happened? Will the Marketing Club sell more liters of Morning Delight? And are any donations now going to waste?

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Managerial Decision Modeling Business Analytics With Spreadsheet

ISBN: 9781501515101

4th Edition

Authors: Nagraj Balakrishnan, Barry Render, Ralph Stair, Charles Munson

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