CITM 501 Spring/Summer 2014

| August 13, 2017

CITM 501
Spring/Summer 2014
Homework Assignment 3

Due June 17, 2014 @5 PM via Bb

ABCis now considering
adding two more lines (in addition to their already existing CRM line) totheir
offering: data warehousing and data backup solutions. The VP of operations that
will be overseeing these three lines has a yearly operating budget of $
1,500,000. ABC makes roughly $0.3 per year for each dollar they spend
(which accounts for personnel, bandwidth, hardware and software and other
overhead costs) on CRM services. Some small-scale market research suggests that
these figures will be $0.27 for data warehousing, and $0.25 for data backup

The company has a
monthly capacity of 4 TB (4,000,000 MB) that they should now dedicate to these
two new lines in addition to the already existing CRM line. So far, roughly
every dollar (per year) spent on the CRM services leads to monthly transactions
that require 1.8 MB of data transfer. They expect these figures will be 1.3 MB
for data warehousing, and 1.9 MB for data backup services.

addition, processing of every 1MB on CRM requires 1.85 minutes of the capacity
of the computing machinery. These figures are 2.25 minutes for both data
warehousing and data backup services. ABC will have a cluster of 20
dedicated computers that run around the clock to provide this capacity.

ABCwants to offer a
balanced portfolio; therefore, they want the budget allocated to each ofthe
three offerings to be at most 40% of their total spending for the three

Your task is to
create a LP model to advice the VP of operations how to allocate their budget
between these three offerings.

Do not try to solve the problem, just
model it.

Submit your model
in a MS Word document. The file name should begin with your first initial
ending with #3 (i.e. _3.docx, e.g. n

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