CAED101 - Model Building Activity
CAED101 - Model Building Activity
ACN1 | CAED101
Model Building
Problem 1.
A retail store in Naga, receives shipments of a particular product from Manila and Baguio. Let
a. Write an expression for the total number of units of the product received by the retail store in
Naga.
b. Shipments from Manila cost $0.20 per unit, and shipments from Baguio cost $0.25 per unit.
Develop an objective function representing the total cost of shipments to Naga.
c. Assuming the monthly demand at the retail store is 5000 units, develop a constraint that
requires 5000 units to be shipped to Naga.
x + y = 5000
d. No more than 4000 units can be shipped from Manila, and no more than 3000 units can be
shipped from Baguio in a month. Develop constraints to model this situation.
x ≤ 4000
y ≤ 3000
e. Of course, negative amounts cannot be shipped. Combine the objective function and
constraints developed to state a mathematical model for satisfying the demand at the Naga retail
store at minimum cost.
a. Let x indicate the number of pairs of shoes produced. Develop a mathematical model
for the total cost of producing x pairs of shoes.
b. Let P indicate the total profit. Develop a mathematical model for the total profit realized from
an order for x pairs of shoes.
P = 40x – (30x+1000)
P = 40x – 30x – 1000
P = 10x – 1000
c. How large must the shoe order be before Nike will break even?
It will take an order size of 99 pairs of shoes wherein there is a loss before Nike will breakeven.
To make a profit, the order size must be greater than the breakeven point of 100 pairs of shoes.