Lopez Farms uses at least 800 Ibs of special feed daily. The special feed is a mixture of corn and soybean meal with the following compositions: Ib per Ib of feedstuff Cost ($/lb) Feedstuff Protein Fiber Corn .09 .02 .30 Soybean meal .60 .06 .90 The dietary requirements of the special feed are at least 30% protein and at most 5% iber. Lopez Farms wishes to determine the daily minimum-cost feed mix.

PROBLEMS 1. Mabel’s Ceramics spent $3000 on a new kiln last year, in the belief that it would cut energy usage 25% over the old kiln. This kiln is an oven that turns “greenware” into finished pottery. Mabel is concerned that the new kiln requires extra labor hours for its operation. Mabel wants to check the energy savings of the new oven, and also to look over other measures of their productivity to see if the change really was beneficial. Mabel has the following data to work with: The year before Year just ended Production (finished units) 4000 4100 Labor (hrs) 350 375 Capital ($) 15000 18000 Energy (kWh) 3000 2600 Also, suppose that the average labor cost is $12 per hour and cost of energy is $0.40 per kwh. a. Were the modifications beneficial? (Compute labor, energy, and capital productivity for the two years and compare.) b. Compute percentage change in multi-factor productivity of the year just ended from that of year before. c. If the multifactor productivity…

Problem 2: SleazeCo manufacturers wind turbines (that produce electricity) for sale in Texas. They currently have one manufacturing facility in Dallas, Texas, that has the following total cost curve: TC, = 10,000,000 + 150,000*q, + 25(qp)² , where q, is the number of turbines produced per year in Dallas and TC, is the total cost in dollars. While these turbines are fairly standard in design, the SleazeCo brand is well-regarded and has some market power. In fact, the demand and marginal revenue curves for SleazeCo is given by Demand: P = $350,000-5q, Marginal Revenue: MR = $350,000 – 10q, where q is the total amount SleazeCo sells, P is the price (in dollars) and MR is the marginal revenue (in dollars). Questions: 1. What is the profit maximizing price SleazeCo's should set for its turbines? 2. What is its profit at this price? 3. Gus Ty, the manager of SleazeCo's turbine business, has done some analysis and has found a facility in Houston, Texas, that, after some alterations, could…

Question 2