Industrial Computers Inc. (ICI) is a rackmount computer manufacturer that produces a number of computers in...

 

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Industrial Computers Inc. (ICI) is a rackmount computer manufacturer that produces a number of computers in various sizes to be stacked and stored in an encloure for industrial use. Production costs for these units varies some depending on price levels, supply chain flow, and other factors. Production of each model must also be balanced with production of other, similar models. Suppose a company like ICI has the following monthly demand, per unit production costs, and capacity for one of their models: Month 1 Month 2 Month 3 Month 4 Demand 500 350 450 600 Production Costs $600 $575 $690 $700 Production Capacity 700 400 400 500 Holding costs are $40 per unit in ending inventory each moth. Initial inventory is 10 units. Determine how many units this company should produce to meet demand and minimize costs. The initial optimal solution will be $1,222,900 Once you find the optimal solution, use Solver Table to see what happens to monthly production, total production costs, total holding costs, and total cost when initial inventory is increased from 0-500 units in increments of 50. Month Production Cost Holding Cost Production Capacity Initial Inventory Production Schedule Produced On hand after production Demand Ending inventory Production cost holding cost Total Net Cost 1 2 3 4 Industrial Computers Inc. (ICI) is a rackmount computer manufacturer that produces a number of computers in various sizes to be stacked and stored in an encloure for industrial use. Production costs for these units varies some depending on price levels, supply chain flow, and other factors. Production of each model must also be balanced with production of other, similar models. Suppose a company like ICI has the following monthly demand, per unit production costs, and capacity for one of their models: Month 1 Month 2 Month 3 Month 4 Demand 500 350 450 600 Production Costs $600 $575 $690 $700 Production Capacity 700 400 400 500 Holding costs are $40 per unit in ending inventory each moth. Initial inventory is 10 units. Determine how many units this company should produce to meet demand and minimize costs. The initial optimal solution will be $1,222,900 Once you find the optimal solution, use Solver Table to see what happens to monthly production, total production costs, total holding costs, and total cost when initial inventory is increased from 0-500 units in increments of 50. Month Production Cost Holding Cost Production Capacity Initial Inventory Production Schedule Produced On hand after production Demand Ending inventory Production cost holding cost Total Net Cost 1 2 3 4

Answer rating: 100% (QA)

Step 1 of 2 Formulate spreadsheet model as follows A B C D E F 1 Month 1 2 3 4 Total 2 Production Cost 600 575 690 700 3 Holding Cost 40 40 40 40 4 Production Capacity 700 400 400 500 SUMB4E4 5 6 Init... View the full answer