2. (20 marks) (Make or Buy problem) A sudden increase in the demand for smoke detectors has left Acme Alarms with insufficient capacity to meet demand. The company has seen monthly demand from its retailers for its electronic and battery-operated detectors rise to 20,000 and 10,000 respectively. Acme's production process involves three departments: fabrication, assembly and shipping. The relevant quantitative data on production and prices are summarized below: Monthly hours Hours per unit Hours per unit Department available (Electronic) (Battery) Fabrication 2000 0.15 0.10 Assembly 4200 0.20 0.20 Shipping 2500 0.10 0.15 Variable cost $18.80 $16.60 Per unit Retail price $29.50 $28.00 (a) (5 marks) Formulate the LP model. (b) (5 marks) Set up your model in excel. (c) (5 marks) Use Solver to obtain the answer and the sensitivity reports. (d) (5 marks) Interpret the answer and the sensitivity reports. 2. (20 marks) (Make or Buy problem) A sudden increase in the demand for smoke detectors has left Acme Alarms with insufficient capacity to meet demand. The company has seen monthly demand from its retailers for its electronic and battery-operated detectors rise to 20,000 and 10,000 respectively. Acme's production process involves three departments: fabrication, assembly and shipping. The relevant quantitative data on production and prices are summarized below: Monthly hours Hours per unit Hours per unit Department available (Electronic) (Battery) Fabrication 2000 0.15 0.10 Assembly 4200 0.20 0.20 Shipping 2500 0.10 0.15 Variable cost $18.80 $16.60 Per unit Retail price $29.50 $28.00 (a) (5 marks) Formulate the LP model. (b) (5 marks) Set up your model in excel. (c) (5 marks) Use Solver to obtain the answer and the sensitivity reports. (d) (5 marks) Interpret the answer and the sensitivity reports