Are revenues independent of the expansion decision?
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A: total number of units = 800
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- Are revenues independent of the expansion decision?
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- A multimedia company anticipates that there will be a demand for 20,000 copiesof a certain DVD during the next year. It costs the company $0.40 to store a DVD for one year. Each time it must make additional DVDs, it costs $250 to set up the equipment. How many DVDs should the company make during each production run to minimize its total storage and setup costs?A fleet repair facility has the capacity to repair 800 trucks per month. However, due toscheduled maintenance of their equipment, management feels that they can repair nomore than 600 trucks per month. Last month, two of the employees were absent severaldays each, and only 400 trucks were repaired.a. Calculate the utilization of the repair shop.b. Calculate the efficiency of the repair shop.c. Discuss the utilization and efficiency of this repair facility. What can be done toimprove the operations at the facilityA restaurant requires different numbers of full-time employees on different days of the week.Union rules state that each full-time employee must five consecutive days and then two daysoff. The management office wants to meet its daily requirements (Monday: 11, Tuesday: 16,Wednesday: 14, Thursday: 15, Friday: 18, Saturday: 19 and Sunday: 23) using only full-timeemployees. Formulate an LP that the restaurant can use to minimize the number of full timeemployees who must be hired
- Cane Company manufactures two products called Alpha and Beta that sell for $210 and $172, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 128,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Alpha Beta Direct materials $ 40 $ 24 Direct labor 38 34 Variable manufacturing overhead 25 23 Traceable fixed manufacturing overhead 33 36 Variable selling expenses 30 26 Common fixed expenses 33 28 Total cost per unit $ 199 $ 171 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 7. Assume that Cane normally produces and sells 58,000 Betas per year. What is the financial advantage (disadvantage) of discontinuing the Beta product line?Suppose that a company needs 1,800,000 items during a year and that preparation for each production run costs $500. Suppose also that it costs $24 to produce each item and $2 per year to store an item. Use the inventory cost model to find the number of items in each production run so that the total costs of production and storage are minimized. items/runGlueco produces three types of glue on two differentproduction lines. Each line can be utilized by up to sevenworkers at a time. Workers are paid $500 per week onproduction line 1, and $900 per week on production line 2.A week of production costs $1,000 to set up production line1 and $2,000 to set up production line 2. During a week ona production line, each worker produces the number of unitsof glue shown in Table 12. Each week, at least 120 units ofglue 1, at least 150 units of glue 2, and at least 200 units ofglue 3 must be produced. Formulate an IP to minimize thetotal cost of meeting weekly demands.
- Niue Vanilla has had two successive years in which the Vanilla bean harvest has stretched the firm’s capacity within their drying sheds. Pita, the manger for the drying operation must now make a decision on capacity for next year. Estimated profits under each of the three possible states of nature are as shown in the table below, along with 3 possible alternatives he is considering: Do Nothing, Expand the Drying Shed operation, or Subcontract to a local farmer group who can do some of the drying. Which alternative should be selected if the decision criterion is: Maximax? Maximin?A diesel engine uses type A filter and high-grade lubricating oil costing P55 per liter. With this filter, the oil and the filter have to be changed every 500hrs. of operation, and 5L of oil have to be added every 100hrs. This filter costs P1480 a piece. Eighty liters of oil fill the engine. Another type, filter B, costing of P1200 may be used with a lower grade of oil costing P48 per liter. However, if this filter is used, the oil and filter have to be changed every 300hrs and 10 liters are added after each 150hrs the engine is used. Hint: Consider the cost per hour.A company needs 450,000 items per year. It costs the company $2,160 to prepare a production run of these items and $14 to produce each item. If it also costs the company $1.50 per year for each item stored, find the number of items that should be produced in each run so that total costs of production and storage are minimized. items/run
- Telefonika is a telecommunication company, located in the Accra Mall, selling mobile phones and accessories. Most of their new phones are ordered. But, Telefonika stocks three main phones for walk-in customers. Every week, they generate profit of GH¢600 from selling Galaxy S2, GH¢400 from Galaxy S3 and GH¢300 from Galaxy S4. The overall weekly cost of these types of phones are GH¢1,800, GH¢2,100 and GH¢1,200 respectively. This week, Telefonika has a budget of GH¢12,000 available to buy these three types of phones. During sales, each phone type must be unpacked, leading to 8 hours of unpacking time for S2 phones, 12 hours for S3 phones and 16 hours for S4 phones. The manager estimates that he and his workers have 120 labour hours available to unpack the three types of phones. Telefonika has enough space to order 20 phones this week. The manager also wants to stock at least twice as many S4 as S2 and S3 phones because S4 phones sell better.a) Formulate a linear programming model for this…A large St. Louis feed mill, Robert Orwig Processing, prepares its 6-month aggregate plan by forecasting demand for 50-pound bags of cattle feed as follows: January, 1,000 bags; February, 1,200; March, 1,250; April, 1,450; May, 1,400; and June, 1,400. The feed mill plans to begin the new year with no inventory left over from the previous year and backorders are not permitted. It projects that capacity (during regular hours) for producing bags of feed will remain constant at 800 until the end of April, and then increase to 1,100 bags per month when a planned expansion is completed on May 1. Overtime capacity is set at 300 bags per month until the expansion, at which time it will increase to 400 bags per month.A private investment club has $200,000 earmarked for investment in stocks. To arrive at anacceptable overall level of risk, the stocks that management is considering have been classifiedinto three categories: high risk, medium risk, and low risk. Management estimates that high-riskstocks will have a rate of return of 15%/year; medium-risk stocks, 10%/year; and low-risk stocks,6%/year. The members have decided that the investment in low-risk stocks should be equal tothe sum of the investments in the stocks of the other two categories. Determine how much theclub should invest in each type of stock if the investment goal is to have a return of$20,000/year on the total investment. (Assume that all the money available for investment isinvested.)Note: Develop the linear system of equations from the above theory and solve the system byGauss Jordon Method.