Posted by **ananya** on Friday, May 28, 2010 at 3:08pm.

Sundown Rent-a-Car, a large automobile rental agency operating in the Midwest, is preparing a leasing strategy for the next six months. Sundown leases cars from an automobile manufacturer and then rents them to the public on a daily basis. A forecast of the demand for Sundownâ€™s cars in the next six months follows:

MONTH MARCH APRIL MAY JUNE JULY AUGUST

Demand 420 400 430 460 470 440

Cars may be leased from the manufacturer for either three, four, or five months. These are leased on the first day of the month and are returned on the last day of the month. Every six months the automobile manufacturer is notified by Sundown about the number of cars needed during the next six months. The automobile manufacturer has stipulated that at least 50% of the cars rented during a six-month period must be on the five-month lease. The cost per month on each of the three types of leases are $420 for the three-month lease, $400 for the four-month lease, and $370 for the five month-lease.

Currently, Sundown has 390 cars. The lease on 120 cars expires at the end of March. The lease on another 140 cars expires at the end of April, and the lease on the rest of these expires at the end of May.

Management of Sundown Rent-a-car has decided that perhaps the cost during the six-month period is not the appropriate cost to minimize because the agency may still be obligated to additional months on some leases after that time. For example, if Sundown had some cars delivered at the beginning of the six-month, Sundown would still be obligated for two additional months on a three-month lease. Use LP to determine how many cars should be leased in each month on each type of lease to minimize the cost of leasing over the entire life of these leases.

- Business -
**Writeacher**, Friday, May 28, 2010 at 3:32pm
What kind of HELP do you need? You need to be specific when asking questions here.

If all you do is post your entire assignment, nothing will happen since no one here will do your work for you. But if you are specific about what you don't understand about the assignment or exactly what help you need, someone might be able to assist you.

- Business -
**Bea**, Sunday, September 23, 2012 at 11:23am
I need an undestanding of the concepts being discussed in this question.

Thanks

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