Discussion:
Q: A firm has two fixed resources that impose limits on its production activities. For a particular period of time it has 30 hours of resource 1 available and 80 hours of resource 2. Suppose that the firm considers making only two products and desire to know the Maximum profit program with Minimize of the costs.
It has the following additional data:
Product 1 Unit profit = $60
Use of resource 1 per unit of output = 1
Use of resources 2 per unit of output = 2
Product 2 Unit profit = $20
Use of resource 1 per unit of output = 0
Use of resources 2 per unit of output = 1
A) Formulate the objective function in the form of an equation.
B) Formulate a Constraint for resource 1 and 2.
C) Determine profit maximization for this Problem
D) Optimal Solution