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200 CHAPTER 4 LINEAR PROGRAMMING APPLICATIONS

Output Measures
Restaurant Weekly Profit Market Share (%) Growth Rate (%)
London £3 800 25 8.0
Manchester £4 600 32 8.5
Edinburgh £4 400 35 8.0
Bristol £6 500 30 10.0
Cardiff £6 000 28 9.0

a. Develop a linear programming model that can be used to evaluate the performance of
the Manchester Quick and Easy restaurant.
b. Solve the model.
c. Is the Manchester Quick and Easy restaurant relatively inefficient? Discuss.
d. Where does the composite restaurant have more output than the Manchester
restaurant? How much less of each input resource does the composite restaurant
require when compared to the Manchester restaurant?
e. What other restaurants should be studied to find suggested ways for the Manchester
restaurant to improve its efficiency?
20 Reconsider the Leisure Air problem from Section 4.5. The demand forecasts shown in
Table 4.16 represent Leisure Air’s best estimates of demand. But, because demand cannot
be forecasted perfectly, the number of seats actually sold for each origin-destination-
itinerary fare (ODIF) may turn out to be smaller or larger than forecasted. Suppose that
Leisure Air believes that economic conditions have improved and that their original forecast
may be too low. To account for this possibility, Leisure Air is considering switching the
Boeing 737–400 aeroplanes with Boeing 757–200 aeroplanes that Leisure Air has available
in other markets. The Boeing 757–200 aeroplane has a seating capacity of 158.
a. Because of scheduling conflicts in other markets, suppose that Leisure Air is only able
to obtain one Boeing 757–200. Should the larger plane be based in Glasgow or in
Edinburgh? Explain.
b. Based upon your answer in part (a), determine a new allocation for the ODIFs. Briefly
summarize the major differences between the new allocation using one Boeing 757–200
and the original allocation summarized in Figure 4.11.
c. Suppose that two Boeing 757–200 aeroplanes are available. Determine a new allocation
for the ODIF’s using the two larger aeroplanes. Briefly summarize the major differences
between the new allocation using two Boeing 757–200 aeroplanes and the original
allocation shown in Figure 4.11.
d. Consider the new solution obtained in part (b). Which ODIF has the highest bid price?
What is the interpretation for this bid price?

CASE PROBLEM 1 Planning an Advertising Campaign

he Cossack Grill is an upscale restaurant television, Internet and newspaper advertisements.
T located in St. Petersburg. To help plan an adver- The budget has been set at 279 000 Roubles.
tising campaign for the coming season, the restau- In a meeting with the restaurant’s management
rant’s management team hired the advertising firm team, HJ consultants provided the following informa-
of Hartman & Jablinsky (HJ). The management team tion about the industry exposure effectiveness rating
requested HJ’s recommendation concerning how per ad, their estimate of the number of potential new
the advertising budget should be distributed across customers reached per ad and the cost for each ad.

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