Transportation setup

FIGURE 11.3 A cumulative graph  EXAMPLE 2  

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After reviewing the plan developed in the preceding example, planners have decided to develop an alternative plan. They have learned that one person is about to retire from the company. Rather than replace that person, they would like to stay with the smaller workforce and use overtime to make up for the lost output. The reduced regular-time output is 280 units per period. The maximum amount of overtime output per period is 40 units. Develop a plan and compare it to the previous one.Page 472  SOLUTION  Refer to Example 3 in the textbook. Given the following information set up the problem in a transportation table and solve for the minimum-cost plan: (Omit the “$” sign in your response.)

   

PERIOD 123  Demand  550      700     750        Capacity                Regular  500      500     500          Overtime  50      50     50          Subcontract  120      120     100        Beginning inventory  100           Costs          Regular time$  60 per unit    Overtime$  80 per unit    Subcontract$  90 per unit      Inventory carrying cost$  1 per unit per month      Back-order cost$  3 per unit per month  

   Minimum total cost$ [removed]  

 

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