Question

1. COMPUTER PRODUCTION. MVC Enterprises can manufacture four different computer models; the Student, Plus, Net, and Pro models. The following gives the configurations of each model Student Celeron 20 gb Plus Pentium 20 gb Net Celeron 20 gb Pro Pentium 30 gb NO YES CD R/W YES DVD DVD + CD R/W Processor Hard Drive Floppy Drives Zip Drive Audio/Video Monitor Case Production Times (hrs.) Unit Profit YES DVD + CD R/W 17" Tower 15" 15 17" Tower Mini-Tower Mini-Tower .5 $70 $80 $130 $150 • • • MVC must satisfy a contract that produces a minimum of 100 Net models per week. MVC employs 25 workers, each of whom averages 30 production hours each per week. The following resources are available weekly: Processors Celeron - 700 Pentium - 550 Hard Drives 20 gb-800 30 gb-950 Other Drives Floppy-1600 Zip-1000 Audiovisual CD R/W-1600 DVD-900 Monitors 15" - 850 17" - 800 Cases Mini-Tower - 1250 Tower - 750

Answer 1

a)

Optimal weekly production schedule:

Production Student = 325
Production Plus = 100
Production Net = 375
Production Pro = 425

Optimal weekly profit = 143250

b)

Allowable decrease of Production plus is 55 which means minimum profit => lower range of optimality => 80-55 = 25 for which optimal quantity production for Production plus will remain same as calculated in part a)

c)

Yes MVC should do this as shadow price of 17 in monitor total is 25 and this is valid for another 100 17 inch monitors. This means for every additional unit profit will increase by 25 which is more than the cost to do it which is 15

d)

No MVC should not do this as there is slack in production hours total constraint which means that the available production hours is not utilized so no point in increase production hours by hiring additional worker