Evans:
Evans Enterprises has bought a prime parcel of beachfrontproperty and plans to build a luxury hotel. After meeting with thearchitectural team, the Evans family has drawn up some informationto make preliminary plans for construction. Excluding the suites,which are not part of this decision, the hotel will have four kindsof rooms: beachfront non-smoking, beachfront smoking, lagoon viewnon-smoking, and lagoon view smoking. To decide how many of each ofthe four kinds of rooms to plan for, the Evans family will considerthe following information.
After adjusting for expected occupancy, the average nightlyrevenue for a beachfront non-smoking room is $175. The averagenightly revenue for a lagoon view non-smoking room is $130. Smokerswill be charged an extra $15.
Construction costs vary. The cost estimate for a lagoon viewroom is $12,000 and for a beachfront room is $15,000. Air purifyingsystems and additional smoke detectors and sprinklers ad $3000 tothe cost of any smoking room. Evans Enterprises has raised $6.3million in construction guarantees for this portion of thebuilding.
There will be at least 120 but no more than 180 beachfrontrooms.
Design considerations require that the number of lagoon viewrooms be at least 1.5 times the number of beachfront rooms, and nomore than 2.5 times that number.
Industry trends recommend that the number of smoking rooms be nomore than 50% of the number of non-smoking rooms.
There should be at least 45 rooms of each kind.
What is the optimal solution?
What is the optimal value of the objective function?
For what values of the objective coefficient will the abovesolution be valid? Include ranges for all decision variables.
If the budget increases to 7 million what is the change in theobjective function? What is the shadow price for budget?
