8 45 returns 150 700 3 300 7 45 680 1230

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Unformatted text preview: ds. Once an item is begun, it will require resources for a known number of periods. Formulation must consider: resource availability, choice of variables, and continuing use over the life of the enterprise. Time preferences, and initial and terminal conditions must also be specified. Strawberry Example Strawberry five­year time horizon two crops: wheat and strawberries strawberries take 3 years to produce wheat is annual farm has 700 acres, 50 acres currently in first­year strawberries 1200 acre­feet of water available Strawberry Problem Strawberry Berry Information Year 1 2 Cost/Acre 150 280 Yield/Acre 0 7 Water/acre 0.8 4.5 Returns -150 700 3 300 7 4.5 680 1230 Wheat is an annual with net returns of $340/acre and annual water needs of 1 acre foot. Strawberries sell for $140 ton. Approaches Approaches We can model annually, or use the “committed” land approach we saw earlier with the activity sequences for crop production. Objective Land Yr 1 Water Yr 1 Land Yr 2 Water Yr 2 Land Yr 3 Water Yr 3 Land Yr 4 Water Yr 4 Land Yr 5 Water Yr 5 Straw 1yo Straw 2yo Year 1 Wheat Strawberries 340 1230 1 1 1 0.8 1 4.5 1 4.5 Year 2 Year 3 Year 4 Year 5 Terminal Conditions Wheat Strawberries Wheat Strawberries Wheat Strawberries Wheat Strawberries 1 2 340 1230 340 1230 340 550 340 -150 160 110 1 1 1 0.8 1 4.5 1 4.5 1 1 1 0.8 1 4.5 1 4.5 1 1 1 0.8 1 4.5 -1 1 1 1 0.8 -1 1 1 Terminal values for strawberry acres in progress are provided in the objective function as given in the book. Initial conditions are 60 acres planted already, 50 in 1 year old strawberries and 10 in 2 year old berries. Land available is reduced accordingly in years 1 and 2. When you solve this problem, 60 acres of profit from the pre­committed strawberry land are not included in the objective function. le le le le le le le le le le le...
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