Question
STL Furniture produces three types of chairs: A, B, C. These chairs sell for A=$1,250, B=$800, C=$600. The general manager wants to determine how many
STL Furniture produces three types of chairs: A, B, C. These chairs sell for A=$1,250, B=$800, C=$600. The general manager wants to determine how many chairs to build of each type during the next quarter. Model A requires 5 hours to build, while model b requires 4 hours and model C requires 3 hours, the company has 8000 labor hours available, and each hour of labor costs 75 dollars. In order to sell these chairs, the company has to pay a one-time licensing fee for the design which is different for each of the models: A=$125, B=$200, C=$100. In order to guarantee that there is enough variety available for customers, the company has decided to produce a minimum of 300 units for each model. Develop a linear model with binary variables that can be used to maximize the companys profit, correctly accounting for fixed costs and staying within resource availabilities.
How many chairs of model C should the company produce?
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