What are the steps to answer question 3 TJ, Inc., makes three nut mixes for sale to grocery chains located in the Southeast. The three mixes,referred to as the Regular Mix, the Deluxe Mix, and the Holiday Mix, are made by mixing different.percentages of five types of nuts.In preparation for the fall season, TJ, Inc., purchased the following shipments of nuts:Type of NutAlmondBrazilFilbertPecanWalnutShipment Amount (pounds)60007500750060007500The Regular Mix consists of 15% almonds, 25% Brazil nuts, 25 %filberts, 10% pecans, and 25% walnuts.The Deluxe Mix consists of 20% of each type of nut, and Holiday Mix consists of 25% almonds, 15% Brazilnuts, 15% filberts, 25% pecans, and 20% walnuts.An accountant at TJ, Inc., analyzed the cost of packaging materials, sales price per pound, and so forth,and determined that the profit contribution per pound is $1.85 for the Regular Mix, $2.10 for the DeluxeMix, and $2.15 for the Holiday Mix. These figures do not include the cost of specific types of nuts in thedifferent mixes because that cost can vary greatly in the commodity markets.Customer orders already received are summarized here:Type of MixRegularDeluxeHolidayOrders (pounds)1000030005000Because demand is running high, TJ, Inc., expects to receive many more orders than can be satisfied.TJ, Inc., is committed to using the available nuts to maximize profit over the fall season; nuts not usedwill be given to the Free Store. Even if it is not profitable to do so, the president of TJ, Inc., indicated thatthe orders already received must be satisfied.Managerial ReportPerform an analysis of the TJ, Inc. product mix problem. Prepare a summary report of your findings forTJ, Inc.'s president. Be sure to include information and analysis on the following:1. The optimal product mix and the total profit contribution2. A recommendation as to whether TJ, Inc., should purchase an additional 500 pounds of almondsfor $500 from a supplier who overbought3.Recommendations on how profit contribution could be increased (if at all) if TJ, Inc., does notsatisfy all existing orders

Introduction:TJ, Inc., a manufacturer specializing in nut mixes, faces a critical decision-making…

Answered: 3. Recommendations on how profit…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter11: Simulation Models

Section11.4: Marketing Models

Problem 30P: Seas Beginning sells clothing by mail order. An important question is when to strike a customer from...

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The Pigskin Company produces footballs. Pigskin must decide how many footballs to produce each month. The company has decided to use a six-month planning horizon. The forecasted monthly demands for the next six months are 10,000, 15,000, 30,000, 35,000, 25,000, and 10,000. Pigskin wants to meet these demands on time, knowing that it currently has 5000 footballs in inventory and that it can use a given months production to help meet the demand for that month. (For simplicity, we assume that production occurs during the month, and demand occurs at the end of the month.) During each month there is enough production capacity to produce up to 30,000 footballs, and there is enough storage capacity to store up to 10,000 footballs at the end of the month, after demand has occurred. The forecasted production costs per football for the next six months are 12.50, 12.55, 12.70, 12.80, 12.85, and 12.95, respectively. The holding cost incurred per football held in inventory at the end of any month is 5% of the production cost for that month. (This cost includes the cost of storage and also the cost of money tied up in inventory.) The selling price for footballs is not considered relevant to the production decision because Pigskin will satisfy all customer demand exactly when it occursat whatever the selling price is. Therefore. Pigskin wants to determine the production schedule that minimizes the total production and holding costs. As indicated by the algebraic formulation of the Pigskin model, there is no real need to calculate inventory on hand after production and constrain it to be greater than or equal to demand. An alternative is to calculate ending inventory directly and constrain it to be nonnegative. Modify the current spreadsheet model to do this. (Delete rows 16 and 17, and calculate ending inventory appropriately. Then add an explicit non-negativity constraint on ending inventory.)
The Pigskin Company produces footballs. Pigskin must decide how many footballs to produce each month. The company has decided to use a six-month planning horizon. The forecasted monthly demands for the next six months are 10,000, 15,000, 30,000, 35,000, 25,000, and 10,000. Pigskin wants to meet these demands on time, knowing that it currently has 5000 footballs in inventory and that it can use a given months production to help meet the demand for that month. (For simplicity, we assume that production occurs during the month, and demand occurs at the end of the month.) During each month there is enough production capacity to produce up to 30,000 footballs, and there is enough storage capacity to store up to 10,000 footballs at the end of the month, after demand has occurred. The forecasted production costs per football for the next six months are 12.50, 12.55, 12.70, 12.80, 12.85, and 12.95, respectively. The holding cost incurred per football held in inventory at the end of any month is 5% of the production cost for that month. (This cost includes the cost of storage and also the cost of money tied up in inventory.) The selling price for footballs is not considered relevant to the production decision because Pigskin will satisfy all customer demand exactly when it occursat whatever the selling price is. Therefore. Pigskin wants to determine the production schedule that minimizes the total production and holding costs. Modify the Pigskin model so that there are eight months in the planning horizon. You can make up reasonable values for any extra required data. Dont forget to modify range names. Then modify the model again so that there are only four months in the planning horizon. Do either of these modifications change the optima] production quantity in month 1?
Lemingtons is trying to determine how many Jean Hudson dresses to order for the spring season. Demand for the dresses is assumed to follow a normal distribution with mean 400 and standard deviation 100. The contract between Jean Hudson and Lemingtons works as follows. At the beginning of the season, Lemingtons reserves x units of capacity. Lemingtons must take delivery for at least 0.8x dresses and can, if desired, take delivery on up to x dresses. Each dress sells for 160 and Hudson charges 50 per dress. If Lemingtons does not take delivery on all x dresses, it owes Hudson a 5 penalty for each unit of reserved capacity that is unused. For example, if Lemingtons orders 450 dresses and demand is for 400 dresses, Lemingtons will receive 400 dresses and owe Jean 400(50) + 50(5). How many units of capacity should Lemingtons reserve to maximize its expected profit?
In Problem 12 of the previous section, suppose that the demand for cars is normally distributed with mean 100 and standard deviation 15. Use @RISK to determine the best order quantityin this case, the one with the largest mean profit. Using the statistics and/or graphs from @RISK, discuss whether this order quantity would be considered best by the car dealer. (The point is that a decision maker can use more than just mean profit in making a decision.)
Seas Beginning sells clothing by mail order. An important question is when to strike a customer from the companys mailing list. At present, the company strikes a customer from its mailing list if a customer fails to order from six consecutive catalogs. The company wants to know whether striking a customer from its list after a customer fails to order from four consecutive catalogs results in a higher profit per customer. The following data are available: If a customer placed an order the last time she received a catalog, then there is a 20% chance she will order from the next catalog. If a customer last placed an order one catalog ago, there is a 16% chance she will order from the next catalog she receives. If a customer last placed an order two catalogs ago, there is a 12% chance she will order from the next catalog she receives. If a customer last placed an order three catalogs ago, there is an 8% chance she will order from the next catalog she receives. If a customer last placed an order four catalogs ago, there is a 4% chance she will order from the next catalog she receives. If a customer last placed an order five catalogs ago, there is a 2% chance she will order from the next catalog she receives. It costs 2 to send a catalog, and the average profit per order is 30. Assume a customer has just placed an order. To maximize expected profit per customer, would Seas Beginning make more money canceling such a customer after six nonorders or four nonorders?
When you use a RISKSIMTABLE function for a decision variable, such as the order quantity in the Walton model, explain how this provides a fair comparison across the different values tested.
Dr. Thompson makes three bean mixes for coffee shops located in the Austin. The three mixes, referred to as the Tameka Mix, the Christian Mix, and the Tamia Mix, are made by mixing different percentages of five types of beans. In preparation for the fall season, Dr. Thompson just purchased the following shipments of beans at the prices shown: Type of Beans Shipment Amount in pounds Cost Per Shipment in dollars Arabica 6000 7500 Robusta 7500 7125 Liberica 7500 6750 Excelsa 6000 7200 Juno 7500 7875 The Tameka Mix consists of 15% Arabica, 25% Robusta beans, 25% Liberica, 10% Excelsa, and 25% Juno. The Christian Mix consists of 20% of each type of beans, and the Tamia Mix consists of 25% Arabica, 15% Robusta beans, 15% Liberica, 25% Excelsa, and 20% Juno. Dr. Thompson analyzed the cost to get the beans ready and determined that the profit contribution per pound is $1.65 for the Tameka Mix, $2.00 for the Christian Mix, and $2.25 for the…
Dr. Thompson makes three bean mixes for coffee shops located in the Austin. The three mixes, referred to as the Tameka Mix, the Christian Mix, and the Tamia Mix, are made by mixing different percentages of five types of beans. In preparation for the fall season, Dr. Thompson just purchased the following shipments of beans at the prices shown: Type of Beans Shipment Amount in pounds Cost Per Shipment in dollars Arabica 6000 7500 Robusta 7500 7125 Liberica 7500 6750 Excelsa 6000 7200 Juno 7500 7875 The Tameka Mix consists of 15% Arabica, 25% Robusta beans, 25% Liberica, 10% Excelsa, and 25% Juno. The Christian Mix consists of 20% of each type of beans, and the Tamia Mix consists of 25% Arabica, 15% Robusta beans, 15% Liberica, 25% Excelsa, and 20% Juno. Dr. Thompson analyzed the cost to get the beans ready and determined that the profit contribution per pound is $1.65 for the Tameka Mix, $2.00 for the Christian Mix, and $2.25 for the…
Product Mix TJ, Inc., makes three nut mixes for sale to grocery chains located in the Southeast. The three mixes, referred to as the Regular Mix, the Deluxe Mix, and the Holiday Mix, are made by mixing different percentages of five types of nuts. In preparation for the fall season, TJ, Inc., purchased the following shipments of nuts at the prices shown: Type of Nut Shipment Amount (pounds) Cost per Shipment Almond 6000 $7500 Brazil 7500 $7125 Filbert 7500 $6750 Pecan 6000 $7200 Walnut 7500 $7875 The Regular Mix consists of 15% almonds, 25% Brazil nuts, 25% filberts, 10% pecans, and 25% walnuts. The Deluxe Mix consists of 20% of each type of nut, and the Holiday Mix consists of 25% almonds, 15% Brazil nuts, 15% filberts, 25% pecans, and 20% walnuts. An accountant at TJ, Inc., analyzed the cost of packaging materials, sales price per pound, and so forth, and determined that the profit contribution per pound is $1.65 for the Regular…
Product Mix TJ, Inc., makes three nut mixes for sale to grocery chains located in the Southeast. The three mixes, referred to as the Regular Mix, the Deluxe Mix, and the Holiday Mix, are made by mixing different percentages of five types of nuts. In preparation for the fall season, TJ, Inc., purchased the following shipments of nuts at the prices shown: Type of Nut Shipment Amount (pounds) Cost per Shipment Almond 6000 $7500 Brazil 7500 $7125 Filbert 7500 $6750 Pecan 6000 $7200 Walnut 7500 $7875 The Regular Mix consists of 15% almonds, 25% Brazil nuts, 25% filberts, 10% pecans, and 25% walnuts. The Deluxe Mix consists of 20% of each type of nut, and the Holiday Mix consists of 25% almonds, 15% Brazil nuts, 15% filberts, 25% pecans, and 20% walnuts. An accountant at TJ, Inc., analyzed the cost of packaging materials, sales price per pound, and so forth, and determined that the profit contribution per pound is $1.65 for the Regular…
Princetown paints ltd manufactures three basic types of paint. emulsion, gloss, and undercoat. using the same mixing machines and direct labour for each of the three products. the Management accountant of Princetown paints was faced with the task of arranging the weekly production for his company. information about the sale price and costs per 100 liters is given in the following table ( all figures in $). sales price per 100 liters ( emulsion 120), ( gloss 126), ( undercoat 110). variable cost per 100 liters ( emulsion 120), ( gloss 126), ( undercoat 110). direct material costs ( emulsion 11), ( gloss 25), ( undercoat 20). direct labour costs ( emulsion 30), ( gloss 36), ( undercoat 24). mixing costs ( emulsion 32), ( gloss 20), ( undercoat 36). other variable costs ( emulsion 12), ( gloss 15), ( undercoat 10). the cost of direct labour is $3 per hour and the variable cost of mixing is $4 per hour. in any one week, direct labour hours are restricted to 8000 hours and mixing machine…
TJ, Inc., makes three nut mixes for sale to grocery chains located in the Southeast. The three mixes, referred to as the Regular Mix, the Deluxe Mix, and the Holiday Mix, are made by mixing different percentages of five types of nuts. In preparation for the fall season, TJ, Inc., purchased the following shipments of nuts: Type of Nut Shipment Amount (pounds) Almond 6000 Brazil 7500 Filbert 7500 Pecan 6000 Walnut 7500 The Regular Mix consists of 15% almonds, 25% Brazil nuts, 25%filberts, 10% pecans, and 25% walnuts. The Deluxe Mix consists of 20% of each type of nut, and Holiday Mix consists of 25% almonds, 15% Brazil nuts, 15% filberts, 25% pecans, and 20% walnuts. An accountant at TJ, Inc., analyzed the cost of packaging materials, sales price per pound, and so forth, and determined that the profit contribution per pound is $1.85 for the Regular Mix, $2.10 for the Deluxe Mix, and $2.15 for the Holiday Mix. These figures do not include the cost…

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3. Recommendations on how profit contribution could be increased (if at all) if TJ, Inc., does not satisfy all existing orders