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Unformatted text preview: Number 1 POSTED BY ADMIN ON NOVEMBER 15, 2011 ADD COMMENTS Question #1 You are a residential real estate developer and contractor. You create and sell two products: building lots and houses. Suppose you make $20,000 on each home you build and $15,000 on each building lot you develop and then sell. Your principal financial objective is to maximize your profits, and this objectice can be expressed as function, that you want to maximize: $15,000 * Lots + $20,000 * Houses = Profits You have two limiting factors: working capital and bulldozer capacity. Your working capital of $1,200,000 limits the number of lots and houses you can annually sell because every lot requires a $50,000 cash investment and every house requires a $25,000 cash investment. The fact that you have a single bulldozer available for only 3,000 hours each year also limits the number of lots and houses you can...
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This note was uploaded on 03/27/2012 for the course INFO 01 taught by Professor Ermer during the Spring '12 term at Howard.
- Spring '12