A company makes four products that have the following characteristics: Product A sells for $75 but needs $40 of materials to produce; Product B sells for $90 but needs $65 of materials to produce; Product C sells for $110 but needs $80 of materials to produce; Product D sells for $135 but needs $105 of materials to produce. The processing requirements for each product on each of the four machines are shown in the table. Processing Time (min/unit) A B Work Center W 8 12 8 10 12 10 14 4 10 9 12 Work centers W, X, Y, and Z are available for 5 days per week, 1 shift per day (8 hrs.) and have no setup time when switching between products. Market demand is 50 As, 60 Bs, 70 Cs, and 80 Ds per week. In the questions that follow, the traditional method refers to maximizing the contribution margin per unit for each product, and the bottleneck method refers to maximizing the contribution margin per minute at the bottleneck for each product. Each worker is paid $15 per hour and is paid for an entire week, regardless of how much the worker is used.

A company makes four products that have the following characteristics: Product A sells for $75 but needs $40 of materials to produce; Product B sells for $90 but needs $65 of materials to produce; Product C sells for $110 but needs $80 of materials to produce; Product D sells for $135 but needs $105 of materials to produce. The processing requirements for each product on each of the four machines are shown in the table. Processing Time (min/unit) A B Work Center W 8 12 8 10 12 10 14 4 10 9 12 Work centers W, X, Y, and Z are available for 5 days per week, 1 shift per day (8 hrs.) and have no setup time when switching between products. Market demand is 50 As, 60 Bs, 70 Cs, and 80 Ds per week. In the questions that follow, the traditional method refers to maximizing the contribution margin per unit for each product, and the bottleneck method refers to maximizing the contribution margin per minute at the bottleneck for each product. Each worker is paid $15 per hour and is paid for an entire week, regardless of how much the worker is used.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter8: Evolutionary Solver: An Alternative Optimization Procedure

Section8.8: Optimal Permutation Models

Problem 15P

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