A certain dealer owns a warehouse that can store a maximum of600 units of...

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Accounting

A certain dealer owns a warehouse that can store a maximum of600 units of a given commodity. He has on hand 100 units of thecommodity and knows the buying and selling price for the next 5time periods. They are:
PERIOD
BUYING PRICE
SELLING PRICE
1
15
16
2
17
17
3
21
20
4
19
19
5
16
20
He is permitted to sell up to theamount that he has in his warehouse at the beginning of eachperiod. If he buys in a given period, delivery will be made so thatit is in storage at the beginning of the next period. Let(X_i, Y_i) denote the amount he buys and sellsin time-period i respectively. What is the optimal buyingsellingstrategy.
Formulate the linear programming problem.
Develop a spreadsheet and solve the problem.

Answer & Explanation Solved by verified expert

4.4 Ratings (987 Votes)

See the table below for solution As per working given below situation 2 ie Buying price 17 Selling price 17 is the best resuting in profit Period Opening Stock Purchase price of See Answer

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In: AccountingA certain dealer owns a warehouse that can store a maximum of600 units of a...A certain dealer owns a warehouse that can store a maximum of600 units of a given commodity. He has on hand 100 units of thecommodity and knows the buying and selling price for the next 5time periods. They are:PERIODBUYING PRICESELLING PRICE1151621717321204191951620He is permitted to sell up to theamount that he has in his warehouse at the beginning of eachperiod. If he buys in a given period, delivery will be made so thatit is in storage at the beginning of the next period. Let(Xi, Yi) denote the amount he buys and sellsin time-period i respectively. What is the optimal buyingsellingstrategy.Formulate the linear programming problem. Develop a spreadsheet and solve the problem.