# How many bottles of each brand should the store carry daily to maximize the total profit ?

XYZ Grocery sells two types of soft drinks : the brand name A1 Cola and the cheaper store brand XYZ Cola. The margin of profit on the A1 Cola is about 50 paise per bottle, whereas the XYZ Cola grosses 70 paise per bottle. On the average the store sells 500 bottles of both the Colas a day. Although A1 is a better recognized name, customers tend to buy more of the XYZ brand because it is considerably cheaper. It is estimated that the XYZ brand outsells the A1 brand by a ratio of at least 2:1. However XYZ Grocery sells at least 100 bottles of A1 a day.

(i) How many bottles of each brand should the store carry daily to maximize the total profit ?

Don't use plagiarized sources. Get Your Custom Essay on
How many bottles of each brand should the store carry daily to maximize the total profit ?
Just from \$13/Page

(ii) Determine the ratio of the profits per bottle of A1 and XYZ Colas that will keep the solution in (i) unchanged ?

Grab A 14% Discount on This Paper
Pages (550 words)
Approximate price: -
Paper format
• 275 words per page
• 12 pt Arial/Times New Roman
• Double line spacing
• Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Try it now!

Total price:
\$0.00

How it works?