# Decision Analysis

Topics: Advertising, Mass media, Triangular number Pages: 4 (658 words) Published: August 13, 2010
DECISION ANALYSIS ASSIGNMENT 1

Case Problem 1: Planning Advertising Campaign

EXCEL sensitivity report for the Flamingo Grill case problem:

Managerial Report
Question 1:
Data given for Flamingo Grill case problem:
Total budget = \$279000
Advertising media| Exposure rating per ad| New customers per ad| Cost per ad (\$)| HJ consultant limit application to| Television| 90| 4000| 10000| 10|
Newspaper| 10| 1000| 1000| 20|

After consideration of limit for each advertising media:
Newspaper| 5| 800| 1000|

Model:
Decision variables:
Advertising media| Num of campaigns for max effectiveness| Num of campaigns for reduced effectiveness| TOTAL| Television| 10| 5| 15|
Newspaper| 20| 10| 30|
TOTAL| 45| 33| |

TOTAL EXPOSURE = 2160
TOTAL NUMBER OF POTENTIAL NEW CUSTOMERS = 127100
Constraints:
* Must reach at least 100000 new customers
127100 ≥ 100000
* Total campaign slots for maximum effectiveness smaller or same with limit Television: 10 ≤ 10
Newspaper: 20 ≤ 20
33 ≥ 30
* Use not more than 20 television ads
Television: 15 ≤ 20
* Television budget should be at least \$140000
\$150000 ≥ \$140000
* Radio advertising budget is restricted to a maximum of \$99000 \$99000 ≤ \$99000
* Newspaper budget is to be at least \$30000
\$30000 ≥ \$30000
* Overall advertising budget is restricted to a maximum of \$279000 \$279000 ≤ \$279000

Question 2:
If additional \$10000 is added to the advertising budget, the total exposure will increase by 55 units as additional television campaign can be allocated.

Question 3:

The ranges indicate that if the allowable increase and decrease is within a very small range, the...