Supplier T-shirts Keychains M:gn)ets Hats
($)2 In considering the tourist business forecast, the manager of Tourist Trap has
decided to purchase at least 1000 of these items (in some combination) for the season.
The total available purchasing funds are $2950. Keychains do not sell very well, so
the total number of keychains should be limited to a maximum of 15% of the total
number of items. T—shirts are always popular, so the total T—shirt count should be
at least 40% of the total number of items. The total expected revenue per item for
T-shirts, keychains, magnets and hats is $7, $2, $3, and $5, respectively. Formulate
an integer program whose solution determines the best strategy for buying batches
of items from the four suppliers with the goal of maximizing proﬁt Solution. We let a: E 2“ be the number of batches to purchase from each supplier.
In particular, 2:; is the number of batches to purchase from supplier z', where i =
1, 2, 3, 4. The expected proﬁt is the total expected revenue less the cost of purchasing items.
The expected revenue depends upon how many of each item is purchased as part of
the various batches. For T-shirts, we have # of T-shirts = 60:51 + 243:2 + 10% and the total revenue for T—shirts is T—shjrt revenue = 7 (602:1 + 249:2 + 102:4) .