Homework Help Forum: Business (Linear Programming)

Posted by JYD on Sunday, September 7, 2008 at 12:51pm.

Wal-Mart, a discount store chain, is planning to build a new store in Rock Springs, Maryland. The parcel of land the company owns is large enough to accommodate a store with 140,000 square feet of floor space. Based on marketing and demographic surveys of the area and historical data from its other stores, Wal-Mart estimates its annual profit contribution per square foot for each of the store's departments to be as shown in the following table. Department Profit contribution per ft2 Men's clothing $4.25 Women's clothing $5.10 Children's clothing $4.50 Toys $5.20 Housewares $4.10 Electronics $4.90 Auto supplies $3.80 Each department must have at least 15,000 ft2 of floor space and no department can have more than 20% of the total retail floor space. Men's women's and children's clothing plus housewares keep all their stock on the retail floor; however, toys, electronics, and auto supplies keep some items (bicycles, televisions, tires, etc.) in inventory. Thus, 10% of the total retail floor space devoted to these three departments must be set aside outside the retail area for stocking inventory. Formulate a linear programming model that can be used to determine the floor space that should be devoted to each department in order to maximize profit contribution.

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