Operations Management: Processes and Supply Chains (12th Edition) (What's New in Operations Management)
12th Edition
ISBN: 9780134741062
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Chapter C, Problem 12P
Summary Introduction
Interpretation: Number of Dorothy’s pastries that can be baked each day is to be calculated.
Concept Introduction: Demand refers to desire of the consumer to purchase the good and probability refers to describing in numerical of how likely an event can turn out to be true.
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nJuicy Juice manufactures different juices made entirely of various exotic nuts. Their primary market is China and they operate 3 plants located in Ethiopia, Tanzania and Nigeria. You have been asked to help them determine where to manufacture the two newest juices they offer, Gingko Nut and Kola Nut. Each plant has a different variable cost structure and capacity for manufacturing the different juices. Also each juice has an expected demand.
Cost/unit
Gingko
Kola
Ethiopia
¥21.00
¥22.50
Tanzania
¥22.50
¥24.50
Nigeria
¥23.00
¥25.50
Capacity
Units/month
Ethiopia
425
Tanzania
400
Nigeria
750
Demand
Units/month
Gingko
550
Kola
450
same exampe is used but in this case each plant has a different fixed and variable cost structur and cpacity for manufacturing the differnt Juices. the fixed cost only applies if the plant produces any juice
Capacity Unit-Month Fixed…
nJuicy Juice manufactures different juices made entirely of various exotic nuts. Their primary market is China and they operate 3 plants located in Ethiopia, Tanzania and Nigeria. You have been asked to help them determine where to manufacture the two newest juices they offer, Gingko Nut and Kola Nut. Each plant has a different variable cost structure and capacity for manufacturing the different juices. Also each juice has an expected demand.
Cost/unit
Gingko
Kola
Ethiopia
¥21.00
¥22.50
Tanzania
¥22.50
¥24.50
Nigeria
¥23.00
¥25.50
Capacity
Units/month
Ethiopia
425
Tanzania
400
Nigeria
750
Demand
Units/month
Gingko
550
Kola
450
How much of each juice should be made at each plant in order to minimize total cost while meeting demand and adhering to plant capacity?
1. At the beginning of each semester, BOOKY can order 60, 80, or 100 copies of the book from the publisher, each with differing discounts per book. The ordering costs are listed in the following table.
Number of Books Ordered
60
80
100
Ordering Costs
6100
7700
9100
2. BOOKY can either sell the book at the retail price ($130 per copy) or offer a 10% discount ($117 per copy). The demand distributions under different selling prices are listed in the following tables.
The demand distribution for the textbook when the selling price is $130 per copy.
Demand
Probability
70
0.6
90
0.4
The demand distribution for the textbook when the selling price is $117 per copy.
Demand
Probability
80
0.15
100
0.85
3. Any unmet demand for the textbook will be irrecoverable
There are two decision variables in this decision problem: the ordering quantity and the selling price of the textbook.
a) If BOOKY is allowed to return unsold textbooks to the publisher for a refund of…
Chapter C Solutions
Operations Management: Processes and Supply Chains (12th Edition) (What's New in Operations Management)
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