Nordic Boots is making production decisions for ten boots and has two production runs. The first run is based on demand forecasts and the second one is based on actual demand. The first production run must include at least 4000 boots. Capacity is limited with the 2nd production run, but the 2nd production run can be decided after the actual demand is observed. Due to the production minimums, a boot is produced in either the first or the second run, but not in both.

a. Find-out the total expected profit with two production run opportunities.

b. Which boots should be in the first production run and which ones should be in the second production run?

c. Report clearly the (Q) order quantities for each boot style in the first run. Report also the expected total production capacity in the second run.

Q0D Item A B D E F G . 1 J 120 80 80 90 70 130 50 150 85 60 400 1,000 1,340 1,200 1,600 200 1,850 300 1,200 1,800 o 100 200 260 680 862 100 400 50 400 1100 Co 12.0 8.0 8.0 9.0 7.0 13.0 5.0 15.0 8.5 6.0 Cu 24.0 16.0 16.0 18.0 14.0 26.0 10.0 30.0 17.0 12.0 Expected Profit 8,291 14,255 19,171 14,924 15,818 3,782 16,318 8,182 16,691 14,401 Max profit 9,600 16,000 21,440 21,600 22,400 5,200 18,500 9,000 20,400 21,600