The Unilever Company plans to allocate some or all of its monthly advertising budget of GH¢82,000 in the Mankato area. It can purchase local radio spots at GH¢120 per spot, local TV spots at GH¢600 per spot, and local newspaper advertising at GH¢220 per insertion. The company's policy requirements specify that the company must spend at least GH¢40,000 on TV and allow monthly newspaper expenditures up to GH¢60,000. The payoff from each advertising medium is a function of the size of its audience. The general experience of the firm is that the values of insertions and spots in terms of "audience points" (arbitrary unit), are as given below: Radio 40 audience points per spot TV 180 audience points per spot Newspapers 320 audience points per insertion The model was solved using excel solver and part of the results is provided in table 3 below. Use it to answer the auestions that follow. Final Reduced Objective Allowable Allowable Cell Name Value Cost Coefficient Increase Decrease $B$11 $B$12 $B$13 X1 375 150 1E+30 20.76923077 X2 60 180 445 1E+30 X3 = -45 280 45 1E+30 Final Shadow Constraint Allowable Allowable Cell Name Value Price R.H. Side Increase Decrease Advertising Budget $F$5 Usage 75000 1.25 75000 1E+30 33000 Expenditure on TV $F$6 Usage Expenditure 30000 -0.89 30000 33000 30000 on Newspaper $F$7 Usage 15000 1E+30 5000 Number of Radio spots $F$8 Usage 375 100 275 1E+30 QUESTION Determine the optimal solution

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ADVERTISING -OPTIMAL SOLUTION

The Unilever Company plans to allocate some or all of its monthly advertising
budget of GH¢82,000 in the Mankato area. It can purchase local radio spots at
GH¢120 per spot, local TV spots at GH¢600 per spot, and local newspaper
advertising at GH¢220 per insertion.
The company's policy requirements specify that the company must spend at least
GH¢40,000 on TV and allow monthly newspaper expenditures up to GH¢60,000.
The payoff from each advertising medium is a function of the size of its audience.
The general experience of the firm is that the values of insertions and spots in terms
of "audience points" (arbitrary unit), are as given below:
Radio
40 audience points per spot
TV
180 audience points per spot
Newspapers
320 audience points per insertion
The model was solved using excel solver and part of the results is provided in table 3 below.
Use it to answer the auestions that follow.
Final
Reduced
Objective
Allowable
Allowable
Cell
Name
Value
Cost
Coefficient
Increase
Decrease
$B$11
$B$12
$B$13
X1
375
150
1E+30
20.76923077
X2
60
180
445
1E+30
X3 =
-45
280
45
1E+30
Final
Shadow
Constraint
Allowable
Allowable
Cell
Name
Value
Price
R.H. Side
Increase
Decrease
Advertising
Budget
$F$5
Usage
75000
1.25
75000
1E+30 33000
Expenditure
on TV
$F$6
Usage
Expenditure
30000
-0.89
30000
33000 30000
on
Newspaper
$F$7
Usage
15000
1E+30 5000
Number of
Radio spots
$F$8
Usage
375
100
275
1E+30
QUESTION
Determine the optimal solution
Transcribed Image Text:The Unilever Company plans to allocate some or all of its monthly advertising budget of GH¢82,000 in the Mankato area. It can purchase local radio spots at GH¢120 per spot, local TV spots at GH¢600 per spot, and local newspaper advertising at GH¢220 per insertion. The company's policy requirements specify that the company must spend at least GH¢40,000 on TV and allow monthly newspaper expenditures up to GH¢60,000. The payoff from each advertising medium is a function of the size of its audience. The general experience of the firm is that the values of insertions and spots in terms of "audience points" (arbitrary unit), are as given below: Radio 40 audience points per spot TV 180 audience points per spot Newspapers 320 audience points per insertion The model was solved using excel solver and part of the results is provided in table 3 below. Use it to answer the auestions that follow. Final Reduced Objective Allowable Allowable Cell Name Value Cost Coefficient Increase Decrease $B$11 $B$12 $B$13 X1 375 150 1E+30 20.76923077 X2 60 180 445 1E+30 X3 = -45 280 45 1E+30 Final Shadow Constraint Allowable Allowable Cell Name Value Price R.H. Side Increase Decrease Advertising Budget $F$5 Usage 75000 1.25 75000 1E+30 33000 Expenditure on TV $F$6 Usage Expenditure 30000 -0.89 30000 33000 30000 on Newspaper $F$7 Usage 15000 1E+30 5000 Number of Radio spots $F$8 Usage 375 100 275 1E+30 QUESTION Determine the optimal solution
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