Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Jim Kelley is in charge of production planning at Special Products. The company produces three models of their special product that are assembled using components

image text in transcribed
image text in transcribed
Jim Kelley is in charge of production planning at Special Products. The company produces three models of their special product that are assembled using components purchased from outside suppliers. The company works 5 days a week and 8 hours each workday. Production might be limited by market demand, the assembly capacity at several departments and the availability of certain critical components. Market demand during the planning period is limited to 400 units/week of Model SL, 500 units/week of Model GL and 300 units/week of Model LX. The company has firm contracts with vendors to supply minimum quantities of 100 units/week of Model SL, 150 units/week of Model GL, and 100 units/week of Model LX. Besides supplying the minimum amounts, the company would like to make as many more of each model as it can, up to the market limits. Profit margins on the three models are P7,500 on Model SL, P5,000 on Model GL and P10,000 on Model LX. Model SL takes 5 minutes to assemble at shop 1, 4 minutes at shop 2 and 2 minutes at shop 3. Model GL takes 4 minutes to assemble at shop 1, 2 minutes at shop 2 and 6 minutes at shop 4. Model LX takes 3 minutes to assemble at shop 1, 4 minutes at shop 3 and 10 minutes at shop 5. The daily capacities of the 5 shops are limited by the availability of the workforce and equipment to the following hours per day: Shop Shop Capacity (Hours/Day) 1 12 2 14 3 8 4 12 5 10 Model SL uses a special microchip (A) whose supply is limited to 500/week. Model GL uses the same microchip as Model SL and a second microchip (B) whose supply is limited to 400/week. Model LX uses a microchip (C) that's not used in either of the other model; its supply is limited to 600/week. 3. How many units of each model should be scheduled for production each week and what will be the weekly profit? b. What constraints limit profit? c. Should Kelley consider increasing capacity at any of the assembly shops? If so, which ones? d. Should Kelley consider looking for additional suppliers of any of the three special microchips? If so, which ones? |

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Calculus With Applications

Authors: Margaret L Lial, Raymond N Greenwell, Nathan P Ritchey

10th Edition

0321831101, 9780321831101

More Books

Students also viewed these Mathematics questions

Question

3. Avoid making mistakes when reaching our goals

Answered: 1 week ago