2. Production Planning for Components Rummel Electronics produces two cards, a modem and a network adapter Demand for these two products exceeds the amount that the firm can make, but there are to plans to increase production capacity in the short rom. Instead, the firm plans to use subcontracting The two main stages of production are fabrication and assembly, and either step can be subcontracted for either type of card. However, the company policy is not to subcontract both steps for either product. (That is, if modem cards are fabricated by a subcontractor then they must be assembled in house) Components made by subcontractors must pass through the shipping and receiving departments, just like components made internally. At present, the firm has $200 hours available in fabrication, 3600 in assembly and 3200 in shipping inspection. The production requirements, in hours per unit, are given in the following table Assembly Shipping Fabrication 0.35 Product/mode Modem, made entirely in house Network, made entirely in-house Modem, fabricated by wb Network, fabricated by sub 0.16 0.15 0.18 0.12 0.10 0.15 0.16 Modem, assembled by sub 0.35 Network, assembled by sub 0.47 0.14 The direct material costs for the modem cards are $3.25 for manufacturing and 0.50 for assembly for network cards, the costs are 56.10 and 0.50. Subcontracting the manufacturing operation costs $5.35 for modem cards and $8.50 for network cards Subcontracting the assembly operation costs $1.50 for either product. Modem cards sell for $20, and network cards sell for $28. The firm's policy, for each product, is that at most 40% of the units produced can have subcontracted fabrication, and at most 70% of the units can have subcontracted assembly (a) Determine the production and subcontracting schedule that maximizes profits. How many units of cach product should be sold in the optimal plan? What total volume should the subcontractor handle