Refer to question 44 in Chapter 3, and answer the following questions:
a. Create a Spider Plot to summarize what happens to the optimal total profit as the total storage capacity increases from 300,000 cf to 400,000 cf in 10,000 cf increments.
b. Which of the storage capacity amounts considered in the previous question results in the highest profit (without having excessive storage capacity)?
c. How much should the company be willing to pay to increase its storage capacity to 350,000 cf?
d. Suppose the gas trading company has increased its storage capacity to 350,000 cf. Now assume a gas producer is in need of an extra 50,000 cf of storage capacity for the next 10 days and wants to buy this capacity from the gas trading firm. What is the least amount of money the gas trading company should demand to provide this capacity?
This question was answered on: Jul 11, 2017
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