Question

A merchant plans to sell two types of personal computers desktop model and a portable model that will cost Rs25000 and Rs40000 respectively. He estimates that the total monthly demand for computers will not exceed 250 units. Determine the number of units of each type of computer that the merchant should stock to get maximum profit if he does not want to invest more than Rs70lakhs and if his profit on the desktop model is Rs4500 and on portable model is Rs5000.

Answer 1

Let the merchant stock,
x desktop models and y portable models.

Therefore, x≥0 and y≥0

The cost of a desktop model is Rs 25000 and of a portable model is Rs 4000.

However, the merchant can invest a maximum of Rs 70 lakhs.

∴25000x+40000y≤7000000
5x+8y≤1400

The monthly demand for computers will not exceed 250 units.
∴x+y≤250

The profit on a desktop model is Rs 4500 and the profit on a portable model is Rs 5000.
Total profit, Z=4500x+5000y

Thus, the mathematical formulation of the given problem is Maximum Z=4500x+5000y...(1)
Subject to the constraints, 5x+8y≤1400....(2)
x+y≤250...(3)
x,y≥0...(4)

The feasible region determined by the system of constraints is as follows.

The corner points are A(250,0), B(200,50) and C(0,175).

The value of Z at these corner points is as follows.

Corner point| Z=4500x5000y|
---|---|---
A(250,0)| 1125000|
B(200,50)| 1150000| $\rightarrow$Maximum
C(0,175)| 875000|

The maximum value of Z is 1150000 at (200,50).

Thus, the merchant should stock 200 desktop models and 50 portable models to get the maximum profit of Rs 1150000.