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ance Refrigeration, Inc. makes industrial sized refrigerators for grocery retailers. They produce three different types of refrigerating units, which must all be produced by a

ance Refrigeration, Inc. makes industrial sized refrigerators for grocery retailers. They produce three different types of refrigerating units, which must all be produced by a machine that is considered the process bottleneck. The plant operates on 28-hour shifts, 5 days per week, 52 weeks per year. The table below provides the standards at the bottleneck, lot sizes, and demand forecasts for the three units. Due to uncertainty in demand, the operations manager has obtained three different forecasting scenarios (pessimistic, expected, optimistic). The manager believes a 15% capacity cushion is best.

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