Jerusalem Medical Ltd., an Israeli producer of port-able kidney dialysis units and other medical products, develops a 4-month aggregate plan. Demand and capacity ( in units) are forecast as follows:CAPACITYSOURCEMONTH 1MONTH 2 MONTH 3MONTH 4LaborRegular time235255290300Overtime20242624Subcontract12151517Demand255294321301The cost of producing each dialysis unit is $ 985 on regular time, $ 1,310 on overtime, and $ 1,500 on a subcontract.Inventory carrying cost is $ 100 per unit per month. There is to be no beginning or ending inventory in stock andbackorders are not permitted. Set up a production plan that minimizes cost using the transportationmethod.

The following information is given: Cost of producing each unit = $985 Overtime = $1310 and…

Answered: The cost of producing each dialysis…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter5: Network Models

Section5.3: Assignment Models

Problem 13P

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AlwaysRain Irrigation, Incorporated would like to determine capacity requirements for the next four years. Currently two production lines are in place for making bronze and plastic sprinklers. Three types of sprinklers are available in both bronze and plastic: 90-degree nozzle sprinklers, 180-degree nozzle sprinklers, and 360-degree nozzle sprinklers. Management has forecast demand for the next four years as follows: YEARLY DEMAND 1 (IN 000s) 2 (IN 000s) 3 (IN 000s) 4 (IN 000s) Plastic 90 32 44 55 56 Plastic 180 15 16 17 18 Plastic 360 50 55 64 67 Bronze 90 7 8 9 10 Bronze 180 3 4 5 6 Bronze 360 11 12 15 18 Both production lines can produce all the different types of nozzles. The bronze machines needed for the bronze sprinklers require two operators and can produce up to 12,000 sprinklers. The plastic injection molding machine needed for the plastic sprinklers requires four operators and can produce up to 200,000 sprinklers. Three bronze machines and only one…
Jerusalem Medical Ltd., an Israeli producer of portable kidney dialysis units and other medical products, develops a 4-month aggregate plan. Demand and capacity (in units) are forecast as follows: Capacity Source Month 1 Month 2 Month 3 Month 4 Labor Regular time 245 265 280 300 Overtime 15 24 26 22 Subcontract 14 17 20 15 Demand 260 306 316 305 The cost of producing each dialysis unit is $875 on regular time, $1,310 on overtime, and $1,500 on a subcontract. Inventory carrying cost is $100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Minimizing cost using the transportation method, the optimal cost is $nothing (enter your response as a whole number).
Spectrum Hair Salon is considering expanding itsbusiness, as it is experiencing a large growth. Th e question iswhether it should expand with a bigger facility than needed,hoping that demand will catch up, or with a small facility,knowing that it will need to reconsider expanding in three years.Th e management at Spectrum has estimated the followingchances for demand:• Th e likelihood of demand being high is 0.70.• Th e likelihood of demand being low is 0.30.Estimated profi ts for each alternative are as follows:• Large expansion has an estimated profi tability of either$100,000 or $70,000, depending on whether demand turnsout to be high or low.• Small expansion has a profi tability of $50,000, assuming thatdemand is low.• Small expansion with an occurrence of high demand wouldrequire considering whether to expand further. If thebusiness expands at this point, the profi tability is expected tobe $90,000. If it does not expand further, the profi tability isexpected to be $60,000.Draw a…
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Jerusalem Medical Ltd., an Israeli producer of portable kidney dialysis units and other medical products, develops a 4-month aggregate plan. Demand and capacity (in units) are forecast as follows: Capacity Source Month 1 Month 2 Month 3 Month 4 Labor Regular time 245 265 300 300 Overtime 15 24 26 22 Subcontract 14 15 13 15 Demand 260 304 331 305 The cost of producing each dialysis unit is $875 on regular time, $1310 on overtime, and $1500 on a subcontract. Inventory carrying cost is $100 per unit per month. There is to be no beginning or ending inventory in stock and backorders are not permitted. Minimizing cost using the transportation method, the optimal cost is ???$ (enter your response as a whole number).
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Why is it important to balance production capacity with market demand? and provide a scenario examples.
A manager is attempting to put together an aggregate production plan for the coming nine months. She has obtained forecasts of aggregate demand for the planning horizon. The plan must deal with highly seasonal demand; demand is relatively high in months 3 and 4, and again in month 8, as can be seen below: The company has 20 permanent employees, each of whom can produce 10 units of output per month at a cost of $6 per unit. Inventory holding cost is $5 per unit per month, and back-order cost is $10 per unit per month. The manager is considering a plan that would involve hiring two people to start working in month 1, one on a temporary basis who would work until the end of month 5. The hiring of these two would cost $500. Beginning inventory is 0.Start with 20 permanent workers. Prepare a minimum cost plan that may use some combination of hiring ($250 per worker), subcontracting ($8 per unit, maximum of 20 units per month, must use for at least three consecutive months), and overtime…
. Manager T. C. Downs of Plum Engines, a producer of lawn mowers and leaf blowers, must developan aggregate plan given the forecast for engine demand shown in the table. The department has aregular output capacity of 130 engines per month. Regular output has a cost of $60 per engine. Thebeginning inventory is zero engines. Overtime has a cost of $90 per engine.a. Develop a chase plan that matches the forecast and compute the total cost of your plan. Regularproduction can be less than regular capacity. b. Compare the costs to a level plan that uses inventory to absorb fluctuations. Inventory carryingcost is $2 per engine per month. Backlog cost is $90 per engine per month. There should not bea backlog in the last month.MONTH1 2 3 4 5 6 7 8 TotalForecast 120 135 140 120 125 125 140 135 1,040
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