Reference no: EM133674078
Case: Hot&Cold and CaldoFreddo are two European manufacturers of home appliances that have merged. Hot&Cold has plants in France, Germany, and Finland, whereas CaldoFreddo has plants in the United Kingdom and Italy. The European market is divided into four regions: north, east, west, and south. Plant capacities (millions of units per year), annual fixed costs (millions of euros per year), regional demand (millions of units), and variable production and shipping costs (euros per unit) are as shown in Table 5-13 Capacity, Cost, and Demand Data for Hot&Cold and CaldoFreddo. Each appliance sells for an average price of 300 euros. All plants are currently treated as profit centers, and the company pays taxes separately for each plant. Tax rates in the various countries are as follows: France, 0.25; Germany, 0.25; Finland, 0.3; UK, 0.2; and Italy,0.35
For each case below, provide i) Integer programming formulation ii) optimizer software output (Formulation and solution), and iii) Network design in tabular format.
The case before the merger where all plants are kept open if the objective is cost minimization (Production and shipping costs as well as annual fixed cost)
The case before the merger where all plants are kept open if the objective is after-tax profit maximization.
In the case after the merger where all plants are kept open if the objective is cost minimization (Production and shipping costs as well as annual fixed costs)
In the case after the merger, where all plants are kept open if the objective is after-tax profit maximization.
The case after the merger if the plants can be shut down (Saving annual fixed cost for the shutdown plant(s) if the objective is cost minimization.
The case after the merger if the plants can be shut down (Saving annual fixed cost for the shutdown plant(s) if the objective is after-tax profit maximization.