S.Mb Business

Topics: Advertising, Marketing, Infomercial Pages: 2 (429 words) Published: October 3, 2012

The advertising agency promoting the new Breem dishwashing detergent wants to get the best exposure possible for the product within the $100,000 advertising budget ceiling placed upon it. To do so, the agency needs to decide how much of the budget to spend on each of its two most effective media: (1) television spots during the afternoon hours and (2) large ads in the city's Sunday newspaper. Each television spot costs $3,000; each Sunday newspaper ad costs $1,250. The expected exposure, based on industry ratings, is 35,000 viewers for each TV commercial and 20,000 readers for each newspaper advertisement. The agency director, Mavis Early, knows from experience that it is important to use both media in order to reach the broadest spectrum of potential Breem customers. She decides that at least 5 but no more than 25 television spots should be ordered; and that at least 10 newspaper ads should be contracted. How many times should each of the two media be used to obtain maximum exposure while staying within the budget? [a] Use the graphical method to solve.

[b] Use SIMPLEX method to solve

Androgynous Bicycle Company (ABC) has the hottest new products on the upscale toy market -- boys' and girls' bikes in bright fashion colors, with oversized hubs and axles, shell design safety tires, a strong padded frame, chrome-plated chains, brackets and valves, and a nonslip handlebar. Due to the seller's market for high-quality toys for the newest baby boomers, ABC can sell all the bicycles it manufactures at the following prices; boys' bikes -- $220, girls' bikes -- $175. This is the price payable to ABC at its Orlando plant. The firm's accountant has determined that direct labor costs will be 45% of the price ABC receives for the boys' model and 40% of the price received for the girls' model. Production costs other than labor, but excluding painting and packaging, are $44 per boys' bicycle and $30 per girls' bicycle. Painting and...
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