Reference no: EM132232808

Forbelt Corporation has a one-year contract to supply motors for all refrigerators produced by the Ice Age Corporation. Ice Age manufacturers the refrigerators at four locations around the country: Boston, Dallas, Los Angeles, and St. Paul. Plans call for the following number (in thousands) of refrigerators to be produced at each location:

Boston 50 Dallas 70 Los Angeles 60 St. Paul 80 Forbelt’s three plants ae capable of producing the motors. The plans and production capacities (in thousands) are as follows: Denver 100 Atlanta 100 Chicago 150 Because of varying production and transportation costs, the profit that Forbelt earns on each lot of 1000 units depends on which plant produces the lot and which destination it was shipped to.

Ship to:

Produced At: Boston, Dallas, Los Angeles ,St. Paul

Denver 7 , 11 . 8, 13 Atlanta 20, 17 . 12, 10 Chicago 8, 18, 13, 16 With profit maximization as a criterion, Forbelt’s management wants to determine how many motors should be produced at each plant and how many motors should be shipped form each plant to each destination. Review sensitivity report results from excel solver to answer the following:

1) Forbelt is not shipping any motors from Atlanta to Dallas,

a) If it ships 10 motors from Atlanta to Dallas what will be the new total profit ?

b) Can it be achieved with the same distribution plan, why, why not Can it be achieved with the same distribution plan, why, why not ?