# A manufacturer can sell product 1 at a profit of \$20 per unit and product 2 at a profit of

## Question:

A manufacturer can sell product 1 at a profit of \$20 per unit and product 2 at a profit of \$40 per unit. Three units of raw material are needed to manufacture one unit of product 1, and six units of raw material are needed to manufacture one unit of product 2. A total of 15,000 units of raw material are available. If any product 1 is produced, a setup cost of \$20,000 is incurred; if any product 2 is produced, a setup cost of \$35,000 is incurred.

a. Determine how to maximize the manufacturer’s profit.

b. If either of the products is not produced in the optimal solution, use SolverTable to see how much this product’s unit profit must be before it will be produced, and then use SolverTable again to see how much this product’s fixed cost must be decreased before it will be produced.

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## Step by Step Answer:

Related Book For

## Practical Management Science

ISBN: 978-1305250901

5th edition

Authors: Wayne L. Winston, Christian Albright

Question Details
Chapter # 6- Optimization Models with Integer Variables
Section: Problems
Problem: 49
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