Profitability Index
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Trucks-R-Us leases truck to eight potential customers. The expected revenue from each customer is shown below along with the number of trucks that they require to achieve the revenue. Customer F is a long term customer and critical to the business, so they must be serviced. Customers will not accept a partial allocation. If the total number of trucks available are 30, to which customers should the trucks be allocated to maximize revenue.
Customer Required Trucks Expected Revenue
A 5 $70,000
B 4 $52,500
C 3 $52,500
D 2 $25,500
E 1 $28,500
F 12 $180,000
G 6 $147,000
H 1 $22,250
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Solution Summary
Profitability Index is assessed.
Education
- MBA, Indian Institute of Finance
- Bsc, Madras University
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