Question: Answer the following with all steps, calculations, graphs as needed. Problem 1 The General Store at State University is an auxiliary bookstore located near the

Answer the following with all steps, calculations, graphs as needed.
Problem 1
The General Store at State University is an auxiliary bookstore located near the dormito-
ries that sells academic supplies, toiletries, sweatshirts and T-shirts, magazines, packaged
food items, and canned soft drinks and fruit drinks. The manager of the store has noticed
that several pizza delivery services near campus make frequent deliveries. The manager is
therefore considering selling pizza at the store. She could buy premade frozen pizzas and
heat them in an oven. The cost of the oven and freezer would be $27,000. The frozen pizzas
cost $3.75 each to buy from a distributor and to prepare (including labor and a box). To be
competitive with the local delivery services, the manager believes she should sell the pizzas
for $8.95 apiece. The manager needs to write up a proposal for the universitys director of
auxiliary services.
a. Determine how many pizzas would have to be sold to break even.
b. If the General Store sells 20 pizzas per day, how many days would it take to break even?
c. The manager of the store anticipates that once the local pizza delivery services start
losing business, they will react by cutting prices. If after a month (30 days) the manager hasto lower the price of a pizza to $7.95 to keep demand at 20 pizzas per day, as she expects,
what will the new break-even point be, and how long will it take the store to break even?
Problem 2
A jewelry store makes necklaces and bracelets from gold and platinum. The store has 18
ounces of gold and 20 ounces of platinum. Each necklace requires 3 ounces of gold and 2
ounces of platinum, whereas each bracelet requires 2 ounces of gold and 4 ounces of plat-
inum. The demand for bracelets is no more than four. A necklace earns $300 in profit and a
bracelet, $400. The store wants to determine the number of necklaces and bracelets to make
to maximize profit.
a. Formulate a linear programming model for this problem.
b. Solve this model by using graphical analysis.
Problem 3
Universal Claims Processors processes insurance claims for large national insurance compa-
nies. Most claim processing is done by a large pool of computer operators, some of whom are
permanent and some of whom are temporary. A permanent operator can process 16 claims
per day, whereas a temporary operator can process 12 per day, and on average the company
processes at least 450 claims each day. The company has 40 computer workstations. A
permanent operator generates about 0.5 claim with errors each day, whereas a temporary
operator averages about 1.4 defective claims per day. The company wants to limit claims
with errors to 25 per day. A permanent operator is paid $64 per day, and a temporary
operator is paid $42 per day. The company wants to determine the number of permanent
and temporary operators to hire to minimize costs.
a. Formulate a linear programming model for this problem.
b. Solve this model by using graphical analysis.

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