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09 QM Lecture Note C Supplement

# 09 QM Lecture Note C Supplement - e SP for Market for I= f...

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E: # of external modems to be produced I: # of internal modems to be produced Max(Total revenue) Max \$45 E + \$ 120 I Engineer A: 20 E + 5 I <= 2400 minutes Engineer B: 15 E + 30 I <= 2400 minutes Demand for E: E <= 100 units Demand for I: I <= 50 units Questions: (i)Which is the preferred product now, E or I, why? What is the optimal E=….. I=…….. (ii) a)Allowable increase for the objective coefficient of E= b)Allowable decrease for the objective coefficient of I= c) SP for Engineer B= d) SP for Market for E=

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Unformatted text preview: e) SP for Market for I= f) Suppose the shadow prices are Engineer A: 20 E + 5 I <= 2400 minutes \$0/min Engineer B: 15 E + 30 I <= 2400 minutes \$3/min Demand for E: E <= 100 units \$0/unit Demand for I: I <= 50 units \$30/unit Compute the “MC” E = Reduced cost for E: Compute “MC” I = Reduced cost for I: h) To produce or not to produce a new product, Wireless modem? Assume, no cannibalization. The new product W needs 10 min from A, 10 minutes from B, and sells for \$45/unit. Should we produce W?...
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09 QM Lecture Note C Supplement - e SP for Market for I= f...

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