Download presentation

Presentation is loading. Please wait.

Published byMyra Julien Modified over 2 years ago

1
**No Backlogging Problem # 1(pg.104) October 20,2011**

Stephen Gonzales, Amandeep Tamber, Ross Nakata, Jonathan Gutierrez

2
**Outline Problem Statement Problem Summary Assumptions Formulation**

Constraints Input Values Solutions Sensitivity Analysis Report to Manager

3
Problem Statement A customer requires during the next four months, respectively, 50, 65, 100, and 70 units of a commodity (no backlogging is allowed). Production costs are $5, $8, $4, and $7 per unit during these months. The storage cost from one month to the next is $2 per unit (assessed on ending inventory). It is estimated that each unit on hand at the end of month 4 could be sold for $6. Formulate an LP that will minimize the net cost incurred in meeting the demands of the next four months.

4
**Problem Summary 1 $5 50 2 $8 65 3 $4 100 4 $7 70 Month**

Cost of Production/Unit Demand 1 $5 50 2 $8 65 3 $4 100 4 $7 70

5
**Assumptions No inventory at beginning of month Unlimited capacity**

Other costs in production were ignored

6
Formulation Xt = number of commodities produced each month during month t it = number of commodities on hand at the end of month t where t=1,2,3,4 for each month in the problem. O.F MINIMIZE COST Z = 5x1+8x2+4x3+7x4+2i1+2i2+2i3-6i4

7
**Constraints 1 i1 = 0 + x1 – 50 2 i2= i1 + x2 – 65 3 i3= i2 + x3 – 100**

4 i4= i3 + x3 – 70 5 x1 > 0 6 x2 > 0 7 x3 > 0 8 x4 > 0 9 i1 > 0 10 i2 > 0 11 i3 > 0 12 i4 > 0

8
Input Values

9
Solution

10
**Production Cost per Unit Units Remaining at End of Month**

Solution Table Month Units to Produce Production Cost per Unit Total Production Cost Demand Units Remaining at End of Month Inventory Cost Total Cost 1 115 $ $ 50 65 $ $ 2 $ $ $ $ 3 170 $ $ 100 70 $ $ 4 $ GRAND TOTAL $ 1,525.00

11
Sensitivity Analysis

12
**Sensitivity Analysis Cont.**

13
**Report to Manger The minimum cost we calculated is $1,525 Month**

Units to Produce Demand Units Remaining at End of Month 1 115 50 65 2 3 170 100 70 4

14
**Unit Cost of Production Total Cost (All 4 Months)**

Report to Manager For month 2: Unit Cost of Production Total Cost (All 4 Months) Units to Produce $7.00 and above $1,525 $2.00 to $6.99 $1200 to $ 65

15
Questions?

Similar presentations

OK

Z-Scores and the Normal Distribution Continued Section 8.2.

Z-Scores and the Normal Distribution Continued Section 8.2.

© 2017 SlidePlayer.com Inc.

All rights reserved.

Ads by Google

Ppt on business cycle theories A ppt on loch ness monster facts Ppt on media revolution 7 Ppt on principles of object-oriented programming tutorial Ppt on conference call etiquette Ppt on power grid failure solar Run ppt on html website Ppt on high-level languages were developed for first-generation computer Ppt on second law of thermodynamics equation English 8 unit 12 read ppt online