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    Atlantic Seafood Company buys and distributes seafood throughout the Northeast and has a storage facility in New York City. They purchase large black tiger shrimp each week that they can either store or sell immediately. They want to determine the optimal buying, storing, and selling strategy over the next four weeks to maximize profits while maintaining at least 25,000 pounds of shrimp in storage by week 4. The optimal strategy involves determining how much to purchase and sell each week considering the weekly shrimp prices and $0.15 weekly storage cost per pound.

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    Atlantic Seafood Company buys and distributes seafood throughout the Northeast and has a storage facility in New York City. They purchase large black tiger shrimp each week that they can either store or sell immediately. They want to determine the optimal buying, storing, and selling strategy over the next four weeks to maximize profits while maintaining at least 25,000 pounds of shrimp in storage by week 4. The optimal strategy involves determining how much to purchase and sell each week considering the weekly shrimp prices and $0.15 weekly storage cost per pound.

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    © All Rights Reserved
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    10 views1 page

    LP

    Uploaded by

    Janielle Nave
    Atlantic Seafood Company buys and distributes seafood throughout the Northeast and has a storage facility in New York City. They purchase large black tiger shrimp each week that they can either store or sell immediately. They want to determine the optimal buying, storing, and selling strategy over the next four weeks to maximize profits while maintaining at least 25,000 pounds of shrimp in storage by week 4. The optimal strategy involves determining how much to purchase and sell each week considering the weekly shrimp prices and $0.15 weekly storage cost per pound.

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    1) Problem #1 Atlantic Seafood Company (20 points)

    The Atlantic Seafood Company (ASC) is a buyer and distributor of seafood products that
    are sold to restaurants and specialty seafood outlets throughout the Northeast. ASC has a
    frozen storage facility in New York City that serves as the primary distribution point for
    all products. One of the ASC products is frozen large black tiger shrimp, which are sized
    at 16-20 pieces per pound. Each Saturday ASC can purchase more tiger shrimp or sell the
    tiger shrimp at the existing New York City warehouse market price. The ASC goal is to
    buy tiger shrimp at a low weekly price and sell it later at a higher price. ASC currently
    has 20,000 pounds of tiger shrimp in storage. Space is available to store a maximum of
    100,000 pounds of tiger shrimp each week. In addition, ASC developed the following
    estimates of tiger shrimp prices for the next four weeks:

    Week Price/Ib.

    1 $6.00
    2 $6.20
    3 $6.65
    4 $5.55

    ASC would like to determine the optimal buying-storing-selling strategy for the next four
    weeks. The cost to store a pound of shrimp for one week is $0.15, and to account for
    unforeseen changes in supply or demand, management also indicated that 25,000 pounds
    of tiger shrimp must be in storage at the end of week 4.
    Determine the optimal buying-storing-selling strategy for ASC including the projected
    four-week profit.
     Decision variables: Purchase decisions: Let x1 be the purchase quantity in week 1 (in
    pounds)
    x2 be the purchase quantity in week 1 (in pounds)
    x3 be the purchase quantity in week 1 (in pounds)
    x4 be the purchase quantity in week 1 (in pounds)

    Selling decision:
    Let x11 be the quantity purchased in week 1 and sold in week 1
    x12 be the quantity purchased in week 1 and sold in week 2
    x13 be the quantity purchased in week 1 and sold in week 3
    x14 be the quantity purchased in week 1 and sold in week 4

    Let x22 be the quantity purchased in week 2 and sold in week 2


    x23 be the quantity purchased in week 2 and sold in week 3
    x24 be the quantity purchased in week 2 and sold in week 4

    Let x33 be the quantity purchased in week 3 and sold in week 3


    x34 be the quantity purchased in week 3 and sold in week 4

    Let x44 be the quantity purchased in week 4 and sold in week 4

    This study source was downloaded by 100000856562450 from CourseHero.com on 11-10-2022 05:58:14 GMT -06:00

    https://www.coursehero.com/file/42530615/LPdoc/

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