Question
Mondo Motorcycles Quarter 1 2 3 4 Demand 40 70 50 20 Manufacturing Cost = $400/unit Holding Cost = $100/unit/period Cost of increasing production from
Mondo Motorcycles Quarter 1 2 3 4
Demand 40 70 50 20
Manufacturing Cost = $400/unit
Holding Cost = $100/unit/period
Cost of increasing production from one period to next= $700/unit
Cost of decreasing production from one period to next =$600/unit
Other Information
1. All demands must be met on time 2. A quarters production may be used to meet demand for
that quarter.
3. Production preceding quarter 1 = 50
4. Initial inventory = 0.
Suppose that Mondo no longer must meet demands on time. For each quarter that demand for a motorcycle is unmet, a penalty or shortage cost of $120 per motorcycle short is accessed. Thus, demand can now be backlogged. All demands must be met however, by the end of quarter 4.
a) Modify the formulation of the Mondo problem to allow for backlogged demand.
b) Solve problem using Excels Solver
(Hint: Unmet demand corresponds to it0. Thus it is urs, and we must substitute
it =i't - i''t. Now i''t will be the amount of demand unmet at the end of quarter t.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started