Unformatted text preview: hours of machine time and 8,000 hours of labor capacity. The cost is $12 for one hour of machine time and $20 for one hour of labor time. Unfortunately, the manufacturer does not have enough labor and machine capacity to fill the order. However, they can subcontract any part of their order to an outside competitor. The cost of subcontracting is $92 for one unit of model A, $116 for one unit of model B, and $163 for one unit of model C. The following is relevant data for this problem Model A Model B Model C Number ordered 4,000 3,000 1800 Required machine hrs/unit 3 2.5 4 Required labor hrs/unit 2 3 5 Formulate a Linear Programming model that will determine how much to produce in house and how much to subcontract in order to minimize cost. Set up an Excel spreadsheet for this problem and determine the optimal solution. Obtain the sensitivity report....
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 Fall '07
 Eng
 Optimization, hard copy

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