Decorum, Inc., manufactures high-end ceiling fans. Their sales are seasonal withhigher demand in the warmer summer months. Typically, sales average 400 unitsper month. However, in the hot summer months (June, July, and August), salesspike up to 600 units per month. Decorum can produce up to 500 units permonth at a cost of $300 each. By bringing in temporary workers, Decorum canproduce up to an additional 75 units at a cost of $350 each. Decorum sells theceiling fans for $500 each. Decorum can carry inventory from one month to thenext, but at a cost of $20 per ceiling fan per month. Decorum has 25 units ininventory at the start of January. Assuming Decorum must produce enoughceiling fans to meet demand, how many ceiling fans should Decorum produceeach month (using their regular labor force and/or temporary workers) over thecourse of the next year so as to maximize their total profit?We have a total of type your answer...

Regular production cost$300Over time production cost$350Selling price$500Holding cost$20Beginning…

Answered: Decorum, Inc., manufactures high-end…

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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The call centre operates eight hours a day (0900-1700) five days a week and is closed on weekends. Call volumes and demand fluctuate, but there is one noticeable peak period between mid October and January inclusive (15 weeks). Records show that the average call numbers during the off-peak period is 250 calls per day, whilst on peak days call numbers average 608 calls per day. The call centre is staffed by a team of 3 permanent staff members. Full time staff can handle up to a maximum of 12 calls per hour each and it has been shown that the full time staff can cope with all the calls during off-peak periods. Temporary staff are engaged for the peak period and, generally, can answer 8 calls per hour. Temporary staff, sourced from a local recruitment agency cost £76.75 per 8 hour day shift inclusive of all agency fees. A specialist IT company has proposed installing an enhanced call handling system which, it is claimed, will increase productivity enabling permanent staff to…
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