The Delta company uses three raw materials to make cakes. Delta istrying to reduce warehousing costs and establishes three policies to thatend:i) The annual number of orders for all products must be at least 20 percontractual terms with transportation providers.ii) The average inventory in units must be a maximum of 1800.iii) Because the raw material is perishable, there can never be more than2000 units in inventory of raw material 1. Raw material 2 has amaximum allowed of 1200 units and the raw material 3 can storemaximum 400 units. The following table shows the product information:Materia DemandaCostos por unidadCosto porprima(u/año)ordenar ($)22002300250046503300010100Consider an interest rate of 10% per year.A) Formulate the problem as a mathematical programming modelthat minimizes the total annual cost.b) Represent the problem in a single equation including theconstraints in terms of lambdac) Find the optimized batch sizes for the company's raw materialscomplying with the imposed constraints

Answered: A) Formulate the problem as a…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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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…
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How does the presence of one production constraint affect the relevant cost analysis model? Two ormore production constraints?
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A) Formulate the problem as a mathematical programming model that minimizes the total annual cost. b) Represent the problem in a single equation including the constraints in terms of lambda c) Find the optimized batch sizes for the company's raw materials complying with the imposed constraints