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g purchased. When this occurs, a substantia nas recently reccived purchase requests fro ny's production facilities already are almost accept all three orders. Therefore a decision

g purchased. When this occurs, a substantia nas recently reccived purchase requests fro ny's production facilities already are almost accept all three orders. Therefore a decision

Practical Management Science
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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Exercise 4 The Fly-Right Airplanc Company builds small jet planes to scll to corporations for the use of the exccutives. To meet the needs of these exccutives, the company's customers sometimes order a custom design of the air planes being purchased. When this occurs, a substantial start up cost is incurred to intiate production of these airplanes. Fly-Right has recently reccived purchase requests from three customers with short deadlines. However, as the company's production facilities already are almost completely tied up filling previous orders, it will not be able to accept all three orders. Therefore a decision now needs to be made on the number of airplancs the company will agree to produce (if any) for cach of the three customers. The table below gives the relevant information on cach of the three customers. Each customer has a fixed start-up cost, paid just once irrespective of how many plancs are produced for that customer. The marginal net revenue is received per plane produced. The third row gives the percentage of available capacity nceded for each aircraft.The last row states the number of airplanes ordered by cach customer (less will obviously be ассеpted). Customer 1 3 $3 million $2 million $ 2 million $3 million $0.8 million Start-up cost Marginal net revenue Capacity used per plane Maximum order 20 % 40 % 20% 3 planes 2 plancs 5 planes 1. Formulate an integer linear programming model that can be uscd to maximize Fly-Right's total profit (net revenue - start up costs) 2. Solve your model using a computer and state the number of airplancs produced for cach customer
Transcribed Image Text:Exercise 4 The Fly-Right Airplanc Company builds small jet planes to scll to corporations for the use of the exccutives. To meet the needs of these exccutives, the company's customers sometimes order a custom design of the air planes being purchased. When this occurs, a substantial start up cost is incurred to intiate production of these airplanes. Fly-Right has recently reccived purchase requests from three customers with short deadlines. However, as the company's production facilities already are almost completely tied up filling previous orders, it will not be able to accept all three orders. Therefore a decision now needs to be made on the number of airplancs the company will agree to produce (if any) for cach of the three customers. The table below gives the relevant information on cach of the three customers. Each customer has a fixed start-up cost, paid just once irrespective of how many plancs are produced for that customer. The marginal net revenue is received per plane produced. The third row gives the percentage of available capacity nceded for each aircraft.The last row states the number of airplanes ordered by cach customer (less will obviously be ассеpted). Customer 1 3 $3 million $2 million $ 2 million $3 million $0.8 million Start-up cost Marginal net revenue Capacity used per plane Maximum order 20 % 40 % 20% 3 planes 2 plancs 5 planes 1. Formulate an integer linear programming model that can be uscd to maximize Fly-Right's total profit (net revenue - start up costs) 2. Solve your model using a computer and state the number of airplancs produced for cach customer
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