ass04_due021908_sol

ass04_due021908_sol - ISE310 Spring 2008 Due 02/19/08 (6...

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ISE310 Spring 2008 Session 08 02/11/08 Assignment 04 Due 02/19/08 (6 points) 1. This is a team assignment. All team members get the same grade. If a student does not contribute to the homework, the team should so indicate. The team does not have to be permanent, but this can be a good start towards your first project. 2. You are to construct a problem along the lines of Chapter 5. Describe the problem you are solving in words, followed by equations and a solution derived with solver. Discuss the solution – how you arrived at it, how reasonable it is, what you think of it, how it might be improved, etc. 3. Write a one-paragraph summary suitable for senior management, acquainting them with the results of your study. 4. Some suggestions for consideration – multiple products, more than one level of distribution, varying taxes and tariffs by market, initial costs and operating costs, location of sources, customers and manufacturing plants. Keep in mind that solver is limited and you need to keep your variables within its limits. Build your model slowly and carefully in small parts – it is much easier to debug. 5. Summarizing, your output should be the summary, the body of your report and the Excel solution that can be read without too much difficulty by someone familiar with Excel, Solver, and optimization problems. Use a single Excel file – you can either type into it for the written part or copy bitmaps from Word or Powerpoint. EXECUTIVE SUMMARY Phase II FirstRate Inc. is a major developer of Automatic External Defibrillator (AED) equipment based out of the United States, primarily serving major metropolitans on the West and East coasts. FirstRate’s management is currently considering plans to expand manufacturing capabilities into the Midwest region due its lower production costs and tariffs. The management has asked for more information regarding this initiative’s influence on the national production cost structure. It is sufficient to assume a binary constraint for each region. With low taxes and a high capacity rate of 50,000 units produced from the Midwest, we recommend that a new plant be opened in the region. With this new production facility in the Midwest, produced units will be shipped to the local area and meet demand (Midwest) of 15 million units, as well as shipped to meet demand needs in the West of 35 million units. With all plants operating at high capacity less the Northeast location, total demand of 155 million units is met. Projected national costs are about $94.88 million with the addition of this new plant per production and shipping cycle. Phase III FirstRate’s management has also asked for an outline of potential production plants in the Midwest. Potential areas of production interest tend not to stray far from major metropolitans to meet demand for skilled workers or areas of major parts suppliers. Initial production in these plants will continue on to secondary inspection in federally predestinated locations, where a third party will test
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ass04_due021908_sol - ISE310 Spring 2008 Due 02/19/08 (6...

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