4. Which labor and material resources are completely used? 5. What would be the impact on the optimal solution if the demand for all three products were decreased by 10% each? 6. What would be the impact on the optimal solution if hand cream could be subcontracted at a cost of $35/carton?

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4. Which labor and material resources are completely used?
5. What would be the impact on the optimal solution if the demand for all three
products were decreased by 10% each?
6. What would be the impact on the optimal solution if hand cream could be
subcontracted at a cost of $35/carton?
Transcribed Image Text:4. Which labor and material resources are completely used? 5. What would be the impact on the optimal solution if the demand for all three products were decreased by 10% each? 6. What would be the impact on the optimal solution if hand cream could be subcontracted at a cost of $35/carton?
Briley Cosmetics manufactures and distributes a wide range of skin care products. A
recent order has arrived for 10,000 cartons of face cream, 5,000 cases of body cream,
and 15,000 cases of hand cream. The manufacturing process consists of a two-stage
procedure that uses two types of raw materials (A and B). Briley's monthly production
capacity (first shift) is 15,000 labor-hours for stage 1 and 10,000 for stage 2. The first
shift hourly rates are $8.50 for stage 1 and $9.25 for stage 2. A second shift is available
with a 10% reduction in capacity and a 10% increase in wage rates. The cost for raw
materials is $1/pound for Type A and $1.50/pound for Type B. The manufacturing
facility has available for the next production run 200,000 pounds of Type A and 150,000
pound of Type B. The following table summarizes the resource requirements to produce
each product.
Face
Body
Cream
Hand
Cream
Cream
Labor (hr/carton)
Stage 1
Stage 2
Raw Materials
1.5
1.8
1.0
0.8
1.0
0.5
(Ib/carton)
A
5.0
8.0
3.0
В
7.0
4.0
9.0
Briley can also subcontract with a local supplier for face cream and body cream at a
cost of $40/carton and $55/carton, respectively.
Transcribed Image Text:Briley Cosmetics manufactures and distributes a wide range of skin care products. A recent order has arrived for 10,000 cartons of face cream, 5,000 cases of body cream, and 15,000 cases of hand cream. The manufacturing process consists of a two-stage procedure that uses two types of raw materials (A and B). Briley's monthly production capacity (first shift) is 15,000 labor-hours for stage 1 and 10,000 for stage 2. The first shift hourly rates are $8.50 for stage 1 and $9.25 for stage 2. A second shift is available with a 10% reduction in capacity and a 10% increase in wage rates. The cost for raw materials is $1/pound for Type A and $1.50/pound for Type B. The manufacturing facility has available for the next production run 200,000 pounds of Type A and 150,000 pound of Type B. The following table summarizes the resource requirements to produce each product. Face Body Cream Hand Cream Cream Labor (hr/carton) Stage 1 Stage 2 Raw Materials 1.5 1.8 1.0 0.8 1.0 0.5 (Ib/carton) A 5.0 8.0 3.0 В 7.0 4.0 9.0 Briley can also subcontract with a local supplier for face cream and body cream at a cost of $40/carton and $55/carton, respectively.
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