Question: A grocery store chain has $ 3 5 . 2 million that it wishes to devote to expansion into a new territory. The company can
A grocery store chain has $ million that it wishes to devote to expansion into a new territory.
The company can construct two types of stores, standard which sells food products and basic
household items and deluxe which additionally sells items such as home goods and clothing
Construction costs are $ million per standard store and $ million per deluxe store. There is
no limit to the number of standard stores that can be constructed; however, due to various non
compete clauses, no more than four deluxe stores may be constructed in the territory. The company
has hired a territorial manager for these properties who can devote up to hours per week for field
visits. Including travel time, each standard store will require hours per week of field visitation
time, whereas each deluxe store will only require only hours per week of field visitation time,
as they will have larger onsite management teams. The weekly net revenue is projected to be
$ per standard store and $ per deluxe store. Develop an integer programming model
to determine the optimal number of each type of store to build, with the goal of maximizing total
weekly revenue. Provide all constraints in standard form. You do not need to solve the LP
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