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# Profit Maximising Linear Programming Tutorial

Consider a problem where we two products: Product A (cloth bags) and product B (leather bags). Each unit of Product A that is sold produces \$30 in profit and each unit of Product B that is sold produces \$50 in profit. There are three resources involved (cloth, leather, and labor), and different quantities are required for each item:
Product A requires 1 unit of cloth, 0 units of leather (no leather), and 4 hours of labor.
Product B requires 0 units of cloth (no cloth), 1 unit of leather, and 2 hours of labor.

The available resources that you have are 40 units of cloths, 60 units of leather, and 240 hours of time (labor).
a. How many Product A's and how many Product B's should you make if you want to maximize profit?
b. What is the marginal value of a unit of cloth?
c. What is the marginal value of a unit of leather?

#### Solution Preview

Please find attached word file with step by step explanation of the ...

#### Solution Summary

A step by step explanation of the linear programming formulation as well as the solution using excel solver attached.

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