Production scheduling problem | Marketing homework help

  

Problem 2: (28 points)

The J. Mehta Company’s production manager is planning a series of one-month production periods for stainless steel sinks. The forecasted demand for the next four months is as follows:

  

Month

Demand for   Stainless Steel Sinks

 

Month 1:120

 

Month 2: 160

 

Month 3: 240

 

Month 4: 100

The Mehta firm can normally produce 100 stainless steel sinks in a month. This is done during regular production hours at a cost of $100 per sink. If demand in any one month cannot be satisfied by regular production, the production manager has three other choices:

(1) he can produce up to 50 more sinks per month in overtime but at a cost of $130 per sink;

(2) he can purchase a limited number of sinks from a friendly competitor for resale (the maximum number of outside purchases over the four-month period COMBINED is 450 sinks, at a cost of $150 each);

(3) Or, he can fill the demand from his on-hand inventory. The ending inventory cost is $10 per sink per month.

A constant workforce level is expected. Back orders are NOT permitted (e.g. order taken in period 3 to satisfy demand in later period 2 is not permitted). Inventory on hand at the beginning of month 1 is 40 sinks. 

a. Formulate algebraically the Linear Programming (LP) model for the above “production scheduling” problem. (20 points)

b. Formulate this same linear programming problem on a spreadsheet and SOLVE using Excel Solver (Provide the corresponding “Excel Spreadsheet” and the “Answer Report”). Include “managerial statements” that communicate the results of the analyses. (8 points)

"We Offer Paper Writing Services on all Disciplines, Make an Order Now and we will be Glad to Help"