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194 CHAPTER 4 LINEAR PROGRAMMING APPLICATIONS

8 A local hospital purchases two types of drug from three different suppliers. The suppliers
have limited capacity, and no one supplier can meet all the hospital’s needs. In addition,
the suppliers charge different prices for the drugs. Price data (in price per unit) are as
follows:

Supplier

Drug 1 2 3
A E12 E13 E14
B E10 E11 E10

Each supplier has a limited capacity in terms of the total number of units of each drug
components it can supply. However, as long as the hospital provides sufficient advance
orders, each supplier can devote its capacity to drug A, drug B or any combination of the
two, if the total number of units ordered is within its capacity. Supplier capacities are as
follows:

Supplier 1 2 3

Capacity 600 1000 800

If the hospital expects to need 1000 units of drug A and 800 units of drug B, what purchases do
you recommend? That is, how many units of each drug should be ordered from each supplier?
What is the total purchase cost for the drug?
9 The Atlantic Seafood Company (ASC) is a buyer and distributor of seafood products
that are sold to restaurants and speciality seafood outlets throughout the Western
Europe.ASChasafrozen storagefacilityinLisbonthatservesasthe primary
distribution point for all products. One of the ASC products is frozen large black tiger
shrimp, which are sized at 16–20 pieces per pound. Each Saturday ASC can purchase
more tiger shrimp or sell the tiger shrimp at the existing Lisbon warehouse market
price. The ASC goal is to buy tiger shrimp at a low weekly price and sell it later at
a higher price. ASC currently has 20 000 pounds of tiger shrimp in storage. Space
is available to store a maximum of 100 000 pounds of tiger shrimp each week. In
addition, ASC developed the following estimates of tiger shrimp prices for the next
four weeks:

Week Price/lb.

1 E6.00
2 E6.20
3 E6.65
4 E5.55

ASC would like to determine the optimal buying-storing-selling strategy for the next four weeks.
The cost to store a pound of shrimp for one week is E0.15, and to account for unforeseen

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