Initial exposure after initial exposure advertising

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Initial Exposure After Initial Exposure Advertising Media Exposure Rating per Ad New Customers per Ad Cost per Ad Advertising Media Exposure Rating per Ad New Customers per Ad Cost per Ad Television 90 4000 $10,000 Television 55 1500 $10,000 Radio 25 2000 $3,000 Radio 20 1200 $3,000 Newspaper 10 1000 $1,000 Newspaper 5 800 $1,000 Decision Variables: T1= number of television ads with a rating of 90 and 4000 new customers T2= number of television ads with a rating of 55 and 1500 new customers R1= number of radio ads with a rating of 25 and 2000 new customers R2= number of radio ads with a rating of 20 and 1200 new customers N1= number of newspaper ads with a rating of 10 and 1000 new customers N2= number of newspaper ads with a rating of 5 and 800 new customers Objective Function and Constraints Max 90T1 + 55T2 + 25R1 + 20R2 + 10N1 + 5N2 s.t. T1 < 10 R1 < 15 N1 < 20 10,000T1 + 10,000T2 + 3,000R1 + 3,000R2 + 1,000N1 + 1,000N2 < 279,000 4,000T1 + 1,500T2 + 2,000R1 + 1,200R2 + 1,000N1 + 800N2 > 100,000 -2T1 + -2T2 + R1 + R2 > 0 T1 + T2 < 20 10,000T1 + 10,000T2 > 140,000 3,000R1 + 3,000R2 < 99,000 1,000N1 + 1,000N2 > 30,000
Module B T1, T2, R1, R2, N1, N2 > 0 Optimal Solution : Budget Allocation: T1 = 10, T2 = 5; 10 + 5 = 15 Television ads 15 * 10,000 = $150,000 R1 = 15, R2 = 18; 15 + 18 = 33 Radio ads 33 * 3,000 = $99,000 N1 = 20, N2 = 10; 20 + 10 = 30 Newspaper ads 30 * 1,000 = $30,000 If $10,000 is added to budget: 10,000 * 0.0055(shadow price) = 55 points Part 4 Exposure: 90(10) + 55(4) + 25(15) + 20(13) + 10(20) + 5

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