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Question 2 (27 marks) LMN Enterprises manufactures three products. All the three products require a finishing that is performed with machine A1. In the period
Question 2 (27 marks) LMN Enterprises manufactures three products. All the three products require a finishing that is performed with machine A1. In the period under consideration there is only 27 000 minutes of machine A1 available. The products are packed in boxes that contain 100 units of each. The boxes are considered to represent a unit of production. The following information has also been made available: L M N Cost of production per unit N$40 N$55 N$80 Time needed per unit 0.25 hours 0.5 hours 1 hour Additional information: 1. The demand for product L is unlimited and there are no contractual orders. 2. A regular customer has contracted LMN to supply 200 units of product M per week. If more units of M are produced above the 200, there is a ready a market. 3. Product N is manufactured for a specific customer that requires 150 units per week. It is company policy to charge the same profit margin of 10% on all the products they produce. The production manager has approached you to assist him in determining the mix of the products that would minimize costs for LMN given the constraints they face. REQUIRED: MARKS 2.1 Formulate a linear programming model in standard format. 5 2.2 Construct an extended model which can be solved by means of the simplex method. 6 2.3 Compile the first simplex tableau and identify both the key column as well as the key row .
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