A Swiss watchmaker wants to create a production plan for the next 4 months. Projected orders for the company’s products are listed in the table. Over the 4 month period, watches may be produced in one month and stored in inventory to meet some later month’s demand. Because of seasonal factors, the cost of production is not constant, as shown in the table. The cost of holding a watch in inventory for 1 month is $4. The maximum number of watches that can be held in inventory is 250. The inventory level at the beginning of the planning horizon is 200 watches; the inventory level at the end of the planning horizon is to be 100. Formulate a linear program (do not solve) to determine the optimal amount to produce in each month so that demand is met while minimizing the total cost of production and inventory. Shortages are not permitted. Clearly define all decision variables and constraints
A Swiss watchmaker wants to create a production plan for the next 4 months.
Projected orders for the company’s products are listed in the table. Over the 4 month period,
watches may be produced in one month and stored in inventory to meet some later month’s
demand. Because of seasonal factors, the cost of production is not constant, as shown in the
table. The cost of holding a watch in inventory for 1 month is $4. The maximum number
of watches that can be held in inventory is 250. The inventory level at the beginning of the
planning horizon is 200 watches; the inventory level at the end of the planning horizon is to be
100. Formulate a linear program (do not solve) to determine the optimal amount to produce in
each month so that demand is met while minimizing the total cost of production and inventory.
Shortages are not permitted. Clearly define all decision variables and constraints
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