Question:
Old Pueblo Engineering Contractors creates six-month "rolling" schedules, which are recomputed monthly. For competitive reasons (they would need to divulge proprietary design criteria, methods, and so on), Old Pueblo does not subcontract. Therefore, its only options to meet customer requirements are (1) work on regular time; (2) work on overtime, which is limited to 30 percent of regular time; (3) do customers'' work early, which would cost an additional $5 per hour per month; and (4) perform customers'' work late, which would cost an additional $10 per hour per month penalty, as provided by their contract.
Old Pueblo has 25 engineers on its staff at an hourly rate of $30. The overtime rate is $45. Customers'' hourly requirements for the six months from January to June are