Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The Philbrick Company has two plants on opposite sides of the United States. Each of these plants produces the same two prod - ucts and
The Philbrick Company has two plants on opposite sides of
the United States. Each of these plants produces the same two prod
ucts and then sells them to wholesalers within its half of the coun
try. The orders from wholesalers have already been received for the
next months February and March where the number of units
requested are shown below. The company is not obligated to com
pletely fill these orders but will do so if it can without decreasing its
profits.
Plant Plant
Product February March February March
Each plant has production days available in February and
production days available in March to produce and ship these prod
ucts. Inventories are depleted at the end of January, but each plant
has enough inventory capacity to hold units total of the two
products if an excess amount is produced in February for sale in
March. In either plant, the cost of holding inventory in this way is
$ per unit of product and $ per unit of product
Each plant has the same two production processes, each of
which can be used to produce either of the two products. The pro
duction cost per unit produced of each product is shown below for
each process in each plant. Plant Plant
Product Process Process Process Process
$ $ $ $
$ $ $ $
The production rate for each product number of units produced per
day devoted to that product also is given for each process in each
plant below.
Plant Plant
Product Process Process Process Process
The net sales revenue selling price minus normal shipping
costs the company receives when a plant sells the products to its
own customers the wholesalers in its half of the country is $ per
unit of product and $ per unit of product However, it also is
possible and occasionally desirable for a plant to make a shipment
to the other half of the country to help fill the sales of the other plant.
When this happens, an extra shipping cost of $ per unit of product
and $ per unit of product is incurred.
Management now needs to determine how much of each prod
uct should be produced by each production process in each plant
during each month, as well as how much each plant should sell of
each product in each month and how much each plant should ship
of each product in each month to the other plants customers. The
objective is to determine which feasible plan would maximize the
total profit total net sales revenue minus the sum of the production
costs, inventory costs, and extra shipping costs
a Formulate a complete linear programming model in algebraic
form that shows the individual constraints and decision varia
bles for this problem.
C b Formulate this same model on an Excel spreadsheet instead.
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