Allstate Oil produces two grades of gasoline: reguler and premium. The profit contributions are $0.30 per gallon for regular gasoline, and 0.50 per gallon for premium gasoline.
Each gallon of regular gasoline contains 0.3 gallons of grade A crude oil and each gallon of premium contains 0.6 gallons of grade A crude oil.
For the next production period, Allstate has 18,000 gallons of grade A crude oil available. The refinery used to produce the gasoline has a production capacity of 50,000 gallons for the next production period. Allstate distributors indicated that the demand for the premium gasoline for the next production period would be at most 20,000 gallons
This question was answered on: Sep 21, 2023
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