Question: A chocolate store has contracted to operate a small candy counter in a fashionable store. To start with, the selection of offering will be intentionally limited. The counter will offer a regular mix candy that is equal parts of cashews, caramels, and raisins and a deluxe mix that is one-half cashews and one-half chocolates. These will be sold in one-pound boxes. In addition, the candy counter will offer individual two-pound boxes of cashews, raisins, caramels, and chocolates.

A major attraction of the candy counter is that all candies are made fresh right at the counter. However, there is limited storage space for supplies and ingredients.

The current daily capacity and the cost per pound of each ingredient type are:

Ingredient Capacity (Pounds) Cost per Pound

Cashews 500 $3.40

Raisins 690 1.80

Caramels 560 2.80

Chocolates 675 3.60

In order to present a good image and to encourage purchases, the counter will make at least 60 boxes of each type of product each day. Any leftover boxes at the end of the day will be removed and given to a nearby nursing home for goodwill. The counter has $6,750.00 to allocate to these four ingredients. In addition, the profit from the regular mix boxes must be at least 20 percent of the total profit.

The selling price per box for the various items has been determined to be as follows:

Item Price

Regular $5.25

Deluxe 7.75

Cashews 8.60

Raisins 4.75

Caramels 7.30

Chocolates 10.45

a. Formulate a linear programming model to maximize daily profit for this model. Define all your variables.

b. Use LINDO or WINQSB to solve this model. Interpret your computer printout.