Find out maximum demand for medium model , Finance Basics

Assignment Help:

A company that manufactures electrical appliances is looking at one of its lines (washing machines), where it offers three different levels of specification: Basic which sells for £250, Medium which sells for £450 and Luxury which sells for £700. The production of each machine goes through four different stages and you have been provided with the following data table:

Process\Machine

Basic

Medium

Luxury

Cost per hour

Max. Available

Forming

1.5 hours

3 hours

7 hours

£5.50

6,500 hours

Machining

5 hours

8 hours

14 hours

£7.50

18,000 hours

Assembly

2.5 hours

4.5 hours

8 hours

£9.50

8,500 hours

Testing

2 hours

2 hours

2 ½ hours

£12.00

5,200 hours

 

 

 

 

 

 

The marketing department has also done some market research and believes demand for each of the models is limited to 1,450 units of the basic model, 900 of the medium and 750 of the luxury. You are required to:

1. Formulate this problem as a linear program and use Excel's Solver to arrive at a solution, identifying what is the maximum profit the company can achieve in the washing machine product line.

2. How would your answer change if the following happened:

a. Maximum demand for Medium model was 1,000; OR

b. Maximum available Assembly hours were 9,500.

3. Write a report with a recommended production and marketing plan for the company.


Related Discussions:- Find out maximum demand for medium model

Profit analysis, The Audiology Department at Randall Clinic offers many ser...

The Audiology Department at Randall Clinic offers many services to the clinic’s patients. The three most common , along with cost and utilization data, are as follows: Service Var

Disadvantage of joint stock companies, Disadvantage of Joint Stock Companie...

Disadvantage of Joint Stock Companies Difficult to reconstruct the capital Many formalities in forming the company Heavy initial capital outlay. Loss of secrec

Development of lease finance in middle asia, Development of Lease Finance i...

Development of Lease Finance in Middle Asia Reasons Why Lease Finance Is Not Well Developed In Middle Asia 1. Lease charges are generally prohibitive that is the cost

Example of replacement of assets, Example of Replacement of Assets Est...

Example of Replacement of Assets Estate Developers purchased a machine five years ago on a cost of £7,500.  The machine had a probable economic life of 15 years at the moment

Constraints of venture capital in us, Constraints of Venture Capital in US ...

Constraints of Venture Capital in US 1. Require of rich investors in US, thus inadequate equity capital. 2. Inefficiencies of stock market - NSE is investors and inefficien

Assumptions underlying percentage of sales method, Assumptions Underlying P...

Assumptions Underlying Percentage of Sales Method The fundamental supposition underlying the use of % of sales method is such, there is no inflation in the economy such is the

Preparing contract note in the stock exchange, Preparing Contract Note in t...

Preparing Contract Note in the Stock Exchange Clerk takes the details of the day's transaction to the broker at the end of working day. Broker scrutinizes all transactions o

Finance , Why do some investors prefer high-dividends paying stocks? Why ,i...

Why do some investors prefer high-dividends paying stocks? Why ,ight other investors prefer low-dividend paying stocks?

Dividend cover ratio, Dividend Cover Ratio Dividend cover = EPS/ DPS =...

Dividend Cover Ratio Dividend cover = EPS/ DPS = Earning to ordinary shares/Dividend paid       This signifies the number of times dividend can be paid from earnin

Calculate yield to maturity - annual & semi annual payment, 1) Calculate th...

1) Calculate the yield to maturity of a 7-year $1,000 par value bond with an annual coupon rate of 7.5% and a current price of $1,125. Provide the spreadsheet solutions for both an

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd