PB7-6

Making Decisions Involving Constrained Resource

Prospector Company makes three types of long-burning scented candles. The models vary in terms of size and type of materials (fragrance, decorations, etc.). Unit information for Prospector follows:

Prospector has determined that it can sell a limited number of each candle in the upcoming year. Expected demand for the three models follows:

Required:

1. Suppose that disease in the suppliers? hives has severely restricted the production of beeswax. Thus, beeswax has been identified as the bottleneck. Determine how Prospector should priori-tize production by rank ordering the products from 1 to 3.
2. If only 50,000 pounds of beeswax is available, calculate the number of units of each candle that Prospector should produce to maximize its profit.
3. Suppose that the number of labor hours has been identified as the most constrained resource. Determine how Prospector should prioritize production by rank ordering the products from 1 to 3.
4. If only 215,000 direct labor hours are available, calculate the number of units of each candle that Prospector should produce to maximize its profit.