Hey everyone,
Why do you take the 12000$ and 600$? In the text it is only mentioned that the is "able" to spend these amounts, but willing to spend less. Why do you then assume that he spends 100% of what he is able to do?
Get Active in Our Amazing Community of Over 451,000 Peers!
Schedule mock interviews on the Meeting Board, join the latest community discussions in our Consulting Q&A and find like-minded Case Partners to connect and practice with!
Why do you take the 12000$ and 600$?
Overview of answers
Upvotes
Best answer
I agree with Denis.
Importantly, for every case we have to be clear about the objective, the maximization criteria (client goals or 2nd objective in a sense), and the constraints.
Here, we have:
Objective/Maximization Criteria: "To earn enough money with the “investment” section of the cellar in order to subsidize whatever I consume in the “drinking” section over time"
Constraint: "I'm obviously constrained by several things: the amount of money I am able to spend, the amount of wine I can (or want to) drink, the space available for the cellar"
Was this answer helpful?
I only took a brief look, but I understand it the following way.
2 parts of the basement - consumption / investment.
2 money-spending patterns: 1,500$ kick-start for consumption / 12,000$ for investment, HOWEVER every month after that $300 for consumption and $600 for investment.
So the $12,000 and $600 are intended for investment. Why would you not max this out given the returns you expect?
Was this answer helpful?
Hello!
TBH, agreed with you. This is why you are always encouraged to ask clarifying questions to the interviewer, who would point you i the right direction.
Hope it helps!
Cheers,
Clara
Was this answer helpful?
Related Cases
Expert case by Francesco
Style:
Our client is the US-based biotech company Top Chemicals. They have just developed a fertilizer that is waiting to get approval for commercialization. They hired us to identify the best price for it.
Our client is the US-based biotech company Top Chemicals. They have just developed a fertilizer that is waiting to get approval for commercialization. They hired us to identify the best price for it.
(Open whole case)
2.4k
Times solved
Intermediate
Difficulty
