Posted by **Carla** on Wednesday, October 17, 2012 at 3:17am.

FuelMotion is an oil company that owns two oil processing plants that produce gasoline

from crude oil. Their Georgia Plant produces 2 thousand gallons of premium, 1 thousand

gallons of medium, and 6 thousand gallons of regular gasoline every day it operates.

Their Arizona Plant produces 3 thousand gallons of premium, 4 thousand gallons of

medium and 1 thousand gallons of regular gasoline per day of operation. Chevron has

placed an order for 110 thousand gallons of premium, 80 thousand gallons of medium,

and 90 thousand gallons of regular gasoline and has asked for the order to be filled within

30 days. If it costs FuelMotion $10,000 per day to operate the Georgia Plant and $20,000

per day to operate the Arizona Plant, then determine how it can fill Chevron's order at

minimum cost. Note: it may be necessary to produce more gas than demanded, due to the

way the plants operate.

a. Formulate a linear programming model (that is, define the variables, and write down

the objective function and all constraints mathematically).

b. Create a spreadsheet model for this problem and solve with Excel Solver.

c. What is the optimal solution? What is the optimal value?

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