Electra produces four types of electric motors each on a, Ask an Expert

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Electra produces four types of electric motors, each on a separate assembly line. The respective capacities of the lines are 500, 500, 800, and 750 motors per day. Type 1 motor uses 8 units of a certain electronic component, type 2 motor uses 5 units, type 3 motor uses 4 units, and type 4 motor uses 6 units. The supplier of the component can provide 8000 pieces a day. The prices per motor for the respective types are $60, $40, $25, $30.

(a) Determine the optimum daily production mix.

(b) The present production schedule meets Electra's needs. However, because of competition, Electra may need to lower the price of type 2 motor. What is the most reduction that can be effected without changing the present production schedule?

(c) Electra has decided to slash the price of all motor types by 25%. Use sensitivity analysis to determine if the optimum solution remains unchanged.

(d) Currently, type 4 motor is not produced. By how much should its price be increased to be included in the production schedule?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91903852

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