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During the next three months, General Cars must meet (on time) the following demand for trucks and cars: month 1 – 400 trucks, 800 cars; month 2 – 300 trucks, 300 cars; month 3 – 500 trucks, 500 cars. During each month, at most 1,200 vehicles can be produced. Each truck uses 2.5 tons of steel, and each car uses 1.2 tons of steel. During month 1, steel cost $400 per ton; during month 2, steel costs $600 per ton; and during month 3, steel costs $700 per ton. At most 2,000 tons of steel may be purchased each month (steel may only be used during the month in which it is purchased). At the beginning of month 1, 100 trucks and 225 cars are in inventory. At the end of each month, a holding cost of $100 per vehicle is assessed. Formulate a linear program to meet the demand requirements at minimum cost (include steel costs and holding costs).

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M92025359

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