Question: HiTec has just started to produce supercomputers for a limited period of 4 years. The annual demand, D, for the new computer is described by

HiTec has just started to produce supercomputers for a limited period of 4 years. The annual demand, D, for the new computer is described by the following distribution: The production capacity of the plant is three computers annually at the cost of $5 million each. The actual number of computers produced per year may not equal the demand xactly. An wnsold computer ai the end ofa ycar incus $1 million in storage and maintenance costs. A loss of $2 million occurs if the delivery of a computer is delayed by 1 year. HiTec will not accept new orders beyond year 4 but will continue production in year 5 to satisfy any unfilled demand at the end of year 4. Determine the optimal annual production schedule for HiTec. HiTec has just started to produce supercomputers for a limited period of 4 years. The annual demand, D, for the new computer is described by the following distribution: The production capacity of the plant is three computers annually at the cost of $5 million each. The actual number of computers produced per year may not equal the demand xactly. An wnsold computer ai the end ofa ycar incus $1 million in storage and maintenance costs. A loss of $2 million occurs if the delivery of a computer is delayed by 1 year. HiTec will not accept new orders beyond year 4 but will continue production in year 5 to satisfy any unfilled demand at the end of year 4. Determine the optimal annual production schedule for HiTec
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
