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    Practice For Group Work Week 2-3

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    ENRICH YOUR ENGLISH
    The Better Products Company needs to assign three plants to produce four new products with the goal of minimizing total costs. Table 2.2 shows the costs associated with each plant producing each product. Management now wants to prohibit product splitting, where each product is produced at only one plant. There are three plants and four products, so two plants will each produce one product while the third plant produces two products. Only plants 1 and 2 have the capacity to produce two products. The problem is to assign plants to products with the restriction of no product splitting to minimize total costs.

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    Practice For Group Work Week 2-3

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    ENRICH YOUR ENGLISH
    436 views4 pages
    The Better Products Company needs to assign three plants to produce four new products with the goal of minimizing total costs. Table 2.2 shows the costs associated with each plant producing each product. Management now wants to prohibit product splitting, where each product is produced at only one plant. There are three plants and four products, so two plants will each produce one product while the third plant produces two products. Only plants 1 and 2 have the capacity to produce two products. The problem is to assign plants to products with the restriction of no product splitting to minimize total costs.

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    Transportation

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    Transportation

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    The Better Products Company needs to assign three plants to produce four new products with the goal of minimizing total costs. Table 2.2 shows the costs associated with each plant producing each product. Management now wants to prohibit product splitting, where each product is produced at only one plant. There are three plants and four products, so two plants will each produce one product while the third plant produces two products. Only plants 1 and 2 have the capacity to produce two products. The problem is to assign plants to products with the restriction of no product splitting to minimize total costs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    436 views4 pages

    Practice For Group Work Week 2-3

    Uploaded by

    ENRICH YOUR ENGLISH
    The Better Products Company needs to assign three plants to produce four new products with the goal of minimizing total costs. Table 2.2 shows the costs associated with each plant producing each product. Management now wants to prohibit product splitting, where each product is produced at only one plant. There are three plants and four products, so two plants will each produce one product while the third plant produces two products. Only plants 1 and 2 have the capacity to produce two products. The problem is to assign plants to products with the restriction of no product splitting to minimize total costs.

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    PRACTICE FOR GROUP WORK WEEK 2-3

    Case 2.1 – ASSIGNING PLANTS TO PRODUCTS (BETTER PRODUCTS


    COMPANY)
    The Better Products Company has decided to initiate the production of four new
    products, using three plants that currently have excess production capacity. The products
    require a comparable production effort per unit, so the available production capacity of the
    plants is measured by the number of units of any product that can be produced per day, as
    given in the rightmost column of Table case 2.1. The bottom row gives the required
    production rate (number of units produced per day) to meet projected sales. Each plant can
    produce any of these products, except that Plant 2 cannot produce Product 3. However, the
    variable costs per unit of each product differ from plant to plant, as shown in the main body
    of the table.
    Management now needs to make a decision about which plants should produce
    which
    products. Product splitting, where the same product is produced in more than one plant, is
    permitted.
    Table case 2.1 – The Data for the Better Products Co. Problem Formulated as a Variant
    of a Transportation Problem

    Unit Cost
    Product Capacity
    1 2 3 4
    Plant Available
    1 $41 $27 $28 $24 75
    2 $40 $29 - $23 75
    3 $37 $30 $27 $21 45
    Required production 20 30 30 40
    Case 2.2 – ASSIGNING PLANTS TO PRODUCTS (BETTER PRODUCTS
    COMPANY)
    The Better Products Co. needs to assign three plants to produce four new products.
    The relevant data are given in Table case 2.2. Management had permitted product splitting
    (where the same product is produced in more than one plant). However, there are some
    hidden costs associated with product splitting that are not reflected in Table case 2.2,
    including extra setup, distribution, and administration costs. Therefore, management now
    has decided to have the problem analyzed again under the additional restriction that product
    splitting is prohibited.
    New Problem Statement: Given the data in Table case 2.2, minimize the total cost
    of assigning each plant to at least one new product where each product is to be produced
    in only one plant (no product splitting). Since there are three plants and four new products,
    two plants will produce one new product and a third plant will produce two. Only plants 1
    and 2 have the capacity to produce two.
    Table case 2.2 – Data for the Better Products Co. Problem

    Cost ($/day)
    Product Total
    1 2 3 4
    Plant assignments
    1 820 810 840 960 2
    2 800 870 - 920 2
    3 740 900 810 840 1
    Total assigned 1 1 1 1
    Case 3.1 – Production Scheduling of the Northern Airplane Company
    The Northern Airplane Company builds commercial airplanes for various airline
    companies around the world. The last stage in the production process is to produce the jet
    engines and then to install them (a very fast operation) in the completed airplane frame.
    The company has been working under some contracts to deliver a considerable number of
    airplanes in the near future, and the production of the jet engines for these planes must now
    be scheduled for the next four months.
    To meet the contracted dates for delivery, the company must supply engines for
    installation in the quantities indicated in the second column of Table case 1. Thus, the
    cumulative number of engines produced by the end of months 1, 2, 3, and 4 must be at least
    10, 25, 50, and 70, respectively.
    Table case 1 – Production Scheduling Data for the Northern Airplane Company Problem

    Unit Cost of
    Maximum Production Production
    Scheduled ($million) Unit Cost
    Month of Storage
    Installations Regular Overtime Regular Overtime ($thousand)
    Time Time
    1 10 20 10 1.08 1.10 15
    2 15 30 15 1.11 1.12 15
    3 25 25 10 1.10 1.11 15
    4 20 5 10 1.13 1.15
    The facilities that will be available for producing the engines vary according to other
    production, maintenance, and renovation work scheduled during this period. The resulting
    monthly differences in the maximum number of engines that can be produced during
    regular time hours (no overtime) are shown in the third column of Table case 1, and the
    additional numbers that can be produced during overtime hours are shown in the fourth
    column. The cost of producing each one on either regular time or overtime is given in the
    fifth and sixth columns.
    Because of the variations in production costs, it may well be worthwhile to produce
    some of the engines a month or more before they are scheduled for installation, and this
    possibility is being considered. The drawback is that such engines must be stored until the
    scheduled installation (the airplane frames will not be ready early) at a storage cost of
    $15,000 per month (including interest on expended capital) for each engine, as shown in
    the rightmost column of Table case 1.
    Apply Excel Solver and QM for Windows to help the Northern Airlines Company’s
    production manager develop a schedule for the number of engines to be produced in each
    of the four months so that the total of the production and storage costs will be minimized.

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