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This is a question PMR Limited produces two types of liquid chemicals (T1 and T2) for hospitals. For the next month, a contribution of 40

This is a question

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PMR Limited produces two types of liquid chemicals (T1 and T2) for hospitals. For the next month, a contribution of 40 per m3 of T1, and 25 per m3 of T2 is expected. Maximum sales are expected to be 400 m3 of T1 and 350 m3 of T2. During production, T1 and T2 need to pass through the Mixing, Sterilising and Bottling departments. The following information is available as regards the required input for production: M 1,500 hrs 2,800 hrs Bottling 5 hrs/m3 3.5 hrs/m3 2,240 hrs PMR Limited would like to maximise the overall contribution for the next month. Requirement a) Using appropriate calculations, identify possible constraining factors for the production of T1 and T2, and suggest other factors which, on the basis of the information presented, may not be constrained. 6 Marks b) PMR Limited uses linear programming to enable it to maximise the overall contribution for the production of T1 and T2. Identify the optimal production pattern and the corresponding level of contribution, using the graphical solution of linear programming. Show the equations of the lines accompanying the chart diagram. 13 Marks c) Discuss the possible effect of 70 additional hours overtime in the Bottling department on production levels and overall contribution. Assume that the extra time comes with an additional cost of 25 per hour. Amend the chart diagram accordingly. _6Marks Total2:5Marks

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