Research Equipment Inc. (REC) is a small manufacturer of precision tools used to construct research equipment for engineering departments at colleges and universities. It sells its two main products, REC-1 and REC-2, for $450 and $600, respectively. Due to increasing demand and shortage of specialized labor, REC has found it increasingly difficult to meet the current weekly demand of 100 units of REC-1 and 60 units of REC- . The following flow diagram shows the manufacturing requirements for the two products and the three types of materials required. Material A is used in REC-1 only, Material C is used in REC-2 only, and Material B is used in both REC-1 and REC-2.

The amount of weekly labor available for the four manufacturing operations follows:

Receiving and testing materials: 6,000 minutes

Machining (for Material A only): 10,000 minutes

Assembly: 5,000 minutes

Finishing: 10,000 minutes

Required
Assume that the labor for each operation is specialized and cannot be moved from one activity to another, that all operations except receiving and testing require a high level of skill, and that REC cannot increase the capacity on these operations in the short run.

Required
What is the best production plan for REC? Why?

Transcribed Image Text:

REC-2