Order 1247667: linear programming model

·  Swimming;

·  Fitness centre;

·  Snorkelling

·  Scuba diving

·  Surfing

Three owners, Mr. Chong, Mrs. Aminah and Mr. Samy, will manage the resort. All three owners have extensive amount of experience in running a resort but have minimal expertise in finance and accounting. They have decided to advertise for the resort centre using radio and TV advertisements. Representatives from HMR Radio and a local TV station, TV5 were invited. HMR Radio representative indicated that a radio commercial will cost RM 5000 per minute and would reach 10000 people. TV5 claims that they could provide an audience of 25000 at a cost of RM 7500 per minute. The breakdown by gender of the audiences was:

Unique Resort Centre wants to adopt a policy as follows:

·  Use at least twice as many radio commercials as TV advertisements.

·  Reach at least 45000 people.

·  Make sure that at least 45% of the total audience are females

·  Each TV advertisement will be at most 3 minutes

·  Each radio advertisement will be at most 4 minutes

All the owners approached you and your team, as their consultant, for advice. As they are forming a new resort centre, they would want you to help them to minimize their cost in their advertisement.

The task:

1. In order to determine the advertising strategy, you have to formulate a linear programming model (objective and constraints) for the advertising mix problem faced by Unique Resort Centre. [9 marks]

2. Describe the optimum advertising strategy that you and your team, as consultants will suggest. This will include: How many ads of each type should they buy? What size audience will their advertisements reach? Will enough of the audience be female? How much will it cost? Show all the necessary steps. [15 marks]

Instructions:

· All Excel outputs should be copied and pasted in onto the Microsoft Word document.

Handwritten answers will be disregarded.

· Content must be original, it will be checked through turnitin