CH12. 1.

Vollmer Manufacturing makes three components for sale to refrigeration companies. The components are processed on two machines: a shaper and a grinder. required on each machine are as follows: The shaper is available for 120 hours, and the grinder for 110 hours. No more than 150 units of component 3 can be sold, but up to 1,000 units of component component 2 can be sold. In fact, the company already has orders for 650 units of component 1 that must be satisfied. The per unit selling price and per unit three components are as follows: For each component, calculate the profit margin (profit margin = selling price - material cost - labor cost). Component 1: $ Component 2: $ Component 3: $ Formulate and solve the model to determine the maximum profit. If the constant is "1", it must be entered in the box. If an amount is zero, enter "0". Let C1= units of component 1 manufactured C2= units of component 2 manufactured C3= units of component 3 manufactured Interpret these ranges for company management. Individual changes in the profit coefficients these ranges will not cause a change in the optimal number of components to prod What are the right-hand-side ranges? Interpret these ranges for company management. These are the ranges over which the shadow prices for the associated constraints applicable. d) If more time could be made available on the grinder, how much would it be worth? Explain. , because the constraint related to the time available on the grinder e) If more units of component 3 can be sold by reducing the sales price by $4, should the company reduce the price? , because the production of component 3 would be profitable than the production of the other two reduced price of component 3 would be produced