A manufacturer operates an existing factory in China. It wishes to open one more factory in either Indonesia, Malaysia or Vietnam to cope with the increasing demand. The markets it serves are Malaysia, Singapore and Thailand. Table 1 shows the annual demand from each market, the capacities and fixed costs of the existing and potential factories as well as the variable costs. Where should the manufacturer build its additional factory, if it wants to minimise cost? Table 1: Cost, Demand and Capacity State the objective function, constraints and decision variables. Then, analyse using Excel Solver to find out where the manufacturer should build its additional factory if it wants to minimise cost. Present your answer in a table, stating how many units which factory should supply to which market. Also, calculate and state the total cost of your network.
A manufacturer operates an existing factory in China. It wishes to open one more factory in either Indonesia, Malaysia or Vietnam to cope with the increasing demand. The markets it serves are Malaysia, Singapore and Thailand. Table 1 shows the annual demand from each market, the capacities and fixed costs of the existing and potential factories as well as the variable costs. Where should the manufacturer build its additional factory, if it wants to minimise cost? Table 1: Cost, Demand and Capacity State the objective function, constraints and decision variables. Then, analyse using Excel Solver to find out where the manufacturer should build its additional factory if it wants to minimise cost. Present your answer in a table, stating how many units which factory should supply to which market. Also, calculate and state the total cost of your network.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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A manufacturer operates an existing factory in China. It wishes to open one more factory in either Indonesia, Malaysia or Vietnam to cope with the increasing demand. The markets it serves are Malaysia, Singapore and Thailand. Table 1 shows the annual demand from each market, the capacities and fixed costs of the existing and potential factories as well as the variable costs.
Where should the manufacturer build its additional factory, if it wants to minimise cost?
Table 1: Cost, Demand and Capacity
State the objective function, constraints and decision variables.
Then, analyse using Excel Solver to find out where the manufacturer should build its additional factory if it wants to minimise cost.
Present your answer in a table, stating how many units which factory should supply to which market. Also, calculate and state the total cost of your network.
Transcribed Image Text:China
Indonesia
Malaysia
Vietnam
Demand
(units / year)
Production and Transportation Cost Annual
Malaysia
Fixed Cost
120
100
100
115
Singapore Thailand
130
115
120
115
100
110
110
120
10,000 7,000
15,000
Capacity
(units)
15000
65000
85,000 20,000
85,000
20,000
80,000
20,000
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