Question

A petroleum company has three plants. From a barrel of crude oil, factory #1 can produce 20 gallons of motor oil, 10 gallons of diesel oil and 5 gallons of gasoline. There is also waste in the form of paraffin, among other things. Similarly, factory #2 can produce 4 gallons, 14 gallons, and 5 gallons, respectively, while factory #3 can produce 4 gallons, 5 gallons, and 12 gallons, respectively of motor oil, diesel oil, and gasoline. Factory #1 has 3 gallons of paraffin to dispose of per barrel of crude, factory #2 5 gallons, and factory #3 2 gallons. The current daily demand from distributors is 5000 gallons of motor oil, 8500 gallons of diesel oil and 10000 of gasoline.

QUESTION #5. Suppose factory #3 is shut down by the EPA temporarily for excessive emissions into the atmosphere. If your demand is as it was originally (5000,8500,10000), what would you now say about the companies ability to meet it? What do you recommend they schedule for production now? (Consider the fact that you don’t want to simply tell a client that you can’t solve their problem! They might be paying your company millions of dollars! Offer them lots of options and ideas if you can’t provide exactly what they want.)

Answer 1