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Project #2 Guidelines

Project #2 Guidelines - hours of machine time and 8,000...

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DS 412 Project #2 General guidelines: The work you do on this project MUST be strictly your own. You may not discuss and/or share your work with other fellow students. Please abide by the honor code on this assignment. Any evidence of copying from someone else’s work will be dealt with according to university policy on cheating. This assignment is due on Tuesday November 9, 2010 at the beginning of the class period. Please hand in a hard copy inserted within mid-term II. Late submissions will not be accepted. You should turn in a copy of the Excel spreadsheet for the problem with your name printed in cell A1. Also include a copy of the sensitivity report. ( Total pages = 2). Staple the two pages. The problem: An electronics manufacturer has just received an order for three models of its leading product. Production in house uses labor and machine time. The company has 13,000
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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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