Determine how much labor and capital are needed

Assignment Help Operation Management

Reference no: EM13918900

Let S represent the amount of steel produced (in tons). Steel production is related to the amount of labor used (L) and the amount of capital used (C) by the following function:

S = 20L0.30C 0.70

In this formula L represents the units of labor input and C the units of capital input. Each unit of labor costs $50, and each unit of capital costs $100.

a. Formulate an optimization problem that will determine how much labor and capital are needed in order to produce 50,000 tons of steel at minimum cost.

b. Solve the optimization problem you formulated in part (a). Hint: Use the Multistart option as described in Appendix 8.2. Add lower and upper bound constraints of 0 and 5000 for both L and C before solving.

Text Book: An Introduction to Management Science: Quantitative Approaches to Decision. By David Anderson, Dennis Sweeney, Thomas Williams, Jeffrey Camm, James Cochran.

Reference no: EM13918900

Questions Cloud

Merchandise inventory on october : The Adams Corporation, a merchandising firm, has budgeted its activity for November according to the following information-Sales at $450,000, all for cash-Merchandise inventory on October

Do some research into the buyout of rjr nabisco by kkr : The American financial system is too regulated and its innovation and creativity is being reduced as a result. Agree or disagree with this statement and explain why.

Realizable value of accounts receivable before write off : Prepare the journal entry to record the write-off.What is the cash realizable value of the accounts receivable before the write-off and after the write-off?

Static and dynamic routing : A network engineer is troubleshooting a small LAN network with one border router, GW01 that connects to the Internet Service Provider's (ISP) network.

Determine how much labor and capital are needed : Formulate an optimization problem that will determine how much labor and capital are needed in order to produce 50,000 tons of steel at minimum cost.

Prepare a flexible budget for the actual units produced : Prepare a flexible budget for the actual units produced for January, February, and March in the Machining Department. Assume depreciation is a fixed cost. Enter all amounts as positive numbers. If required, use per unit amounts carried out to two dec..

Calculate the required rate of return on equity : 1. Calculate the required rate of return on equity for General Mills as of the beginning of Year +1. 2. Calculate the sum of the present value of total dividends for Years +1 through +5.

Current profit : What is the current profit?What is the break-even point in units?What would the break-even point in units be if commissions are increased and salaries decreased?If sales increase by 8,000 units, what will the profit be under the new plan?

Find optimal number of gloves to produce at each facility : Use LINGO or Excel Solver to find the solution to your mathematical model to determine the optimal number of gloves to produce at each facility.

User Account

All Pages