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Newnan Foundry makes a Nickel based steel Ni and Titanium Ti precision drop forged rotors for the aircraft industry. The standard process is normally used to make both. However, another process using different raw material and operating characteristics at the forge changes the properties of the rotor, resulting in different machine requirements after forging. The data are as follows:

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Contracts for 50 nickel-based rotors and 18 titanium rotors have been signed for the next month, with 55 and 20 expected the following month. It costs $1000 to hold a nickel based rotor in inventory for one month. The holding cost for a titanium rotor is $4000 per rotor per month. Develop a model to aid Newnan in production planning.

Operation Management, Management Studies

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