Question: This problem includes 2 questions A department store chain DCA is planning to open a new store. The company has gathered $ 2 0 million
This problem includes questions A department store chain DCA is planning to open a new store. The company has gathered $ million to invest in this new store. It needs to decide how to allocate the square feet of available floor space among seven departments in order to maximize the expected profit. Data on expected performance of each department per month, in terms of square feet sf are as follows: Department Investment per sf Risk per $ invested Minimum sf Maximum sf Expected profit per sf Electronics $$ Furniture $$ Men's clothing $$ Women's clothing $$ Jewelry $$ Books $$ Appliances $$ The company has gathered $ million to invest in floor stock. The risk column is a measure of risk associated with investment in floor stock based on past data from other stores and accounts for outdated inventory, pilferage, breakage, and so on For instance, Electronics loses of its total investment, furniture loses of its total investment, and so on The amount of risk should be no more than of the total investment. Question : Formulate the LP problem: identify the decision variables, state the objective function and the constraints, and identify any upper or lower bounds on the decision variables Question : a Implement the linear optimization model that you developed in Question on a spreadsheet b Use the solver to find an optimal solution c Interpret the Solver Answer Report and identify the binding contraints
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