Subject Management Science

Chapter 2 Graphical Solution:

4. Worldwide Claims Processors is a company that processes insurance claims for large national insurance companies. Most claim processing ls done by a large pool of computer operators, some of whom are permanent and some temporary. A permanent operator can process 16 claims per day, whereas a temporary operator can process 12 per day, and on average the company processes at least 45!] claims each day. The company has 40 computer workstations. A permanent operator will generate about 0.5 claims with errors each day. whereas a temporary average about 1.4 defective claims per day. The company wants to limits claims with errors to 25 per day. A permanent operator is paid $64 per day and a temporary operator is paid 42 per day. The company wants to determine the number of permanent and temporary operators to hire in order to minimize costs. a. Formulate a linear programming model for this problem b. Solve this model using graphical analysis