Please answer these questions on a excel sheet.

A company is trying to determine how to allocate its $145,000 advertising budget for a new product. The company is considering newspaper ads and television commercials as its primary means for advertising. The following table summarizes the costs of advertising in these different media and the number of new customers reached by increasing amounts of advertising.

Media & No. of Ads

Newspaper: 1210 Newspaper: 11220 Newspaper: 21230 Television: 125 Television: 6210 Television: 11215

No. of New Customers reached

900 700 400

10,000 7,500 5,000

Cost per Ad

$1,000 $900 $800 $12,000 $10,000 $8,000

For instance, each of the first 10 ads the company places in newspapers will cost $1,000 and is expected to reach 900 new customers. Each of the next 10 newspaper ads will cost $900 and is expected to reach 700 new customers. Note that the number of new customers reached by increasing amounts of advertising decreases as the advertising saturates the market. Assume the company will purchase no more than 30 newspaper ads and no more than 15 television ads.

a) Formulate an LP model for this problem to maximize the number of new customers reached by advertising.

b) Implement your model in a spreadsheet and solve it.

c) What is the optimal solution?

d) Suppose the number of new customers reached by 1120 newspaper ads is 400

and the number of new customers reached by 2130 newspaper ads is 700. Make these changes in your spreadsheet and reoptimize the problem. What is the new optimal solution? What (if anything) is wrong with this solution and why?