NOTE: Only some questions have full solutions while others only have partial solutions.

It is important
that you try the questions before looking at the solutions.

Practice Q uestion 1
Curly Body Shampoo Company makes a hair tonic called Curly Que in both a concentrated and diluted
form. Both are blends or ingredient x and ingredient y and a base stock consisting of water, sodium,
protein, fragrances and various other ingredients. The requirements for the concentrate tonic is that it
contains at least 20% of ingredient x and at least 40% of x and y combined. The diluted form, on the
other hand requires at least 20% of ingredient x while having no more than 60% of the base stock.

Acidity is measured by a quantity called pH. The pH of both the concentrate and diluted form of the hair
tonic must be between 6.8 and 7.2. The pH values of ingredient x, ingredient y, and the base stock are
7.4, 7.1 and 6.6 respectively. Assume that the pH value of the mixture is the weighted average of the pH
of the blended materials.

Ingredient x costs $10/ounce, ingredient y costs $7/ounce and the base stock costs $1.00/ounce. The
concentrate sells for $12.00/ounce and the diluted form sells for $9.00/ounce. The company anticipates
demand for next month to be 400 ounces for the concentrate and 600 ounces for the diluted form. The
availability for ingredient x and y will be 100 ounces and 300 ounces respectively next month.

Formulate a linear programming model.

Solution:

X ij = be the ounces of ith ingredient (i=x, y, b) used in blending jth type of tonic (j=c,d)

Max:

Z = 12 (Xxc + Xyc + Xbc)+ 9 (Xxd + Xyd + Xbd)] ± [10(Xxc+Xxd) + 7(Xyc+Xyd) + (Xbc+ Xbd)]

Subject to:

Xxc/ (Xxc+ Xyc+ Xbc) >= 0.2

Xxc+ Xyc/ (Xxc+ Xyc+ Xbc)>= 0.4

Xxd/ (Xxd+ Xyd+Xbd)>= 0.2

Xbd/(Xxd + Xyd + Xbd) <= 0.6

7.4 Xxc + 7.1Xyc + 6.6Xbc/ (Xxc+ Xyc+ Xbc) >= 6.8

7.4 Xxc + 7.1 Xyc + 6.6Xbc/ (Xxc + Xyc+ Xbc)<= 7.2

7.4Xxd + 7.1Xyd + 6.6Xbd/ (Xxd + Xyd+ Xbd)>=6.8

7.4Xxd + 7.1Xyd+ 6.6Xbd/(Xxd + Xyd + Xbd)<=7.2

Xxc + Xyc + Xbc >=400
Xxd + Xyd + Xbd>=600

Xxc + Xxd <=100

Xyc + Xyd <=300

Xij>=0 for i = x,y,b and j= c,d

Practice Q uestion 2

1. Lost Maples Winery makes three varieties of contemporary Texas Hill Country wines: Austin
Formation (a fine red), Ste. Genevieve (a table white), and Los Alamos (a hearty pink Zinfandel).
The raw materials, labor, and contribution per case of each of these wines is summarized below.
Grapes Grapes Labor
Variety Variety Sugar (man- Contrib
A B pounds hours) . per
bushels bushels case
Austin Formation 4 0 1 3 $24
Ste. Genevieve 0 4 0 1 $28
Los Alamos 2 2 2 2 $20

The winery has 2800 bushels of Variety A grapes, 2040 bushels of Variety B grapes, 800 pounds of
sugar, and 1060 man-hours of labor available during the next week. The firm operates to achieve
maximum contribution. Refer to the Management Scientist output showing the solution at the end
of this problem.

Answer the following questions.

a. For maximum contribution, how much of each wine should be produced?
b. How much contribution will be made by selling the output?
c. Is there any sugar left over? If so, how much?
d. What is the interpretation of the dual price for sugar to Lost Maples' management?.
e. Explain how the solution would change if the labor is reduce by 600 hours? .
f. The management is asked to produce 20 cases of Los Alamos wine. What would be the effect of
this request in the function value?

LINEAR PROGRAMMING PROBLEM

MAX 24X1+28X2+20X3

S.T.

1) 4X1+2X3<2800
2) 4X2+2X3<2040
3) 1X1+2X3<800
4) 3X1+1X2+2X3<1060
OPTIMAL SOLUTION

Objective Function Value = 18680.000

Variable Value Reduced Costs

-------------- --------------- ------------------
X1 183.333 0.000
X2 510.000 0.000
X3 0.000 6.000

Constraint Slack/Surplus Dual Prices

-------------- --------------- ------------------
1 2066.667 0.000
2 0.000 5.000
3 616.667 0.000
4 0.000 8.000
OBJECTIVE COEFFICIENT RANGES

Variable Lower Limit Current Value Upper Limit

------------ --------------- --------------- ---------------
X1 12.000 24.000 84.000
X2 16.000 28.000 No Upper Limit
X3 No Lower Limit 20.000 26.000

RIGHT HAND SIDE RANGES

Constraint Lower Limit Current Value Upper Limit

------------ --------------- --------------- ---------------
1 733.333 2800.000 No Upper Limit
2 0.000 2040.000 4240.000
3 183.333 800.000 No Upper Limit
4 510.000 1060.000 2610.000

Solution:

a) 183 1/3 cases of A ustin Formation, 510 cases of Ste. Genevieve;

b) maximum contribution is $18,680;

c) T here are 617 pounds of sugar remaining; its dual value is zero, indication that management
should not seek out any more sugar;
 d) T his means that if we had to produce a case of los A lamos wine, the total contribution would
decrease by $6.0 for each case produced.

e) If labor is reduced by 600 hours we would have only 460 hours of labor available. A new
solution would have to be generated in order to predict the new function value and production
mix since 460 is lower than the lower limit of 510 hours for constraint 4 in the right hand side
ranges of the computer solution.

f) T he function value would change to $18560

Practice Q uestion 3:

Sampling 4 pieces of precision-cut wire (to be used in Computer assembly) every hour for the past 16
hours has produced the following results:

Construct appropriate control charts using 3 sigma limits and determine whether there is any cause for
concern in the cutting process. On investigation, it was found that there was a power failure in the 8th
hour. Make the necessary change(s) and/or adjustment(s) if any in the control charts in the light of this
information.

Hour X (Mean) R (Range)

1 ´ ² ´

2 3.10 ² 1.18

3 3.22 ² 1.43

4 3.39 ² 1.26

5 3.07 ² 1.16

6 2.86 ² 0.32

7 3.05 0.53

8 3.95 2.79

9 3.02 0.71

10 2.85 ² 1.33

11 2.83 ² 1.17

12 2.97 ² 0.40
13 3.11 ² 0.85

14 2.83 1.31

15 3.12 ² 1.06

16 2.84 ² 0.50

Partial Answer:

Practice Q uestion 4

The Great Outdoors Clothing Company is a mail order catalog operation. Whenever a customer returns
an item for a return, credit or exchange, he or she is asked to complete a return form. For each item
returned, the customer is asked to insert a code indicating the reason for the return. The company does
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VKRZQLQWKHFDWDORJ¶WREHWKHGHIHFWVLQWKHFDWDORJ7KHFRPSDQ\KDVUDQGRPO\FKHFNHG
customers return forms for 20 days and collected the following data for catalog defects:

You are required to construct a control chart using three sigma limits to monitor catalog defects and
indicate if the process is in control, clearly stating the reason.

Sample
Number of
Sample
Catalog Defects Number of Catalog
Defects

1 18 11 54

2 26 12 37

3 43 13 26

4 27 14 29

5 18 15 37

6 36 16 65

7 42 17 54

8 28 18 31

9 61 19 40

10 37 20 50

Answer (partial answer):

P chart
UCL = 52.508%
LCL = 23.392%

The process is not in control because:

Many data points are beyond the upper control and lower control limits. It also seems that may be a slight
upward trend.

Practice question 5

Suppose a car manufacturing company is using the following linear programming for producing four
types of cars. Compact cars, Family Cars, Sports model cars, and Luxury cars with an objective to
maximize the profit:
X1 is the number of compact cars produced per month
X2 is the number of family cars produced per month
X3 is the number of sports model cars produced per month, and
X4 is the number of luxury cars produced per month

Max 1500 x1 + 3000 x2 + 9000 x3 + 4000 x4

Subject

C1 Budget 10000 x1 + 15000 x2 + 40000 + 50000x3 <= 50000000

C2 Storage space 35 x1 + 45 x2 + 45 x3 + 50 x4 <= 100000
C3 Assembly time 50 x1 + 60 x2 + 150 x3 + 100 x4<= 300000
C4 Compact cars x1 >= 3X3
C5 Family cars x2>=50

X1,x2,3,x4>=0

LINEAR PROGRAMMING PROBLEM

MAX 1500X1+3000X2+9000X3+4000X4

S.T.

1) 10000X1+15000X2+40000X3+50000X4<50000000
2) 35X1+45X2+45X3+50X4<100000
3) 50X1+60X2+150X3+100X4<300000
4) 1X1-3X3>0
5) 1X2>50

OPTIMAL SOLUTION

Objective Function Value = 8947500.000

Variable Value Reduced Costs

-------------- --------------- ------------------
X1 1955.000 0.000
X2 50.000 0.000
X3 651.667 0.000
X4 0.000 500.000

Constraint Slack/Surplus Dual Prices

-------------- --------------- ------------------
1 3633333.333 0.000
2 0.000 90.000
3 101500.000 0.000
4 0.000 -1650.000
 5 0.000 -1050.000
OBJECTIVE COEFFICIENT RANGES

Variable Lower Limit Current Value Upper Limit

------------ --------------- --------------- ---------------
X1 1000.000 1500.000 7000.000
X2 No Lower Limit 3000.000 4050.000
X3 7500.000 9000.000 No Upper Limit
X4 No Lower Limit 4000.000 4500.000

RIGHT HAND SIDE RANGES

Constraint Lower Limit Current Value Upper Limit

------------ --------------- --------------- ---------------
1 46366666.667 50000000.000 No Upper Limit
2 2250.000 100000.000 107785.714
3 198500.000 300000.000 No Upper Limit
4 -573.684 0.000 2792.857
5 0.000 50.000 2222.222

a) Clear state optimal solution

Produce 1955 compact cars, 50 family cars, 652 sports cars and 0 luxury cars per month

b) Due to a series of labor union non-cooperation strikes for pay raise, several workers were absent
and that created a loss of 100000 hours of assembly time. How does it impact this LP model?

No since we still have 101500 slack hours of assembly time

c) If you were managing this company, which resource among the budget, storage space and
assembly time would you increase? By how much? And what does it accomplish?

Increase storage space to 107785.7 square feet, this would increase profits by (90)(7785.7)= 700713

d) The company announced a special promotion of $1000 cash back for each sports model car. How
does this promotion impact this LP model?

Solution mix would remain the same since change it is within the range of (7500, infinite), the
new price of $8000 would decrease profits to 8947500- (1000)(651.66)= 8295840

e) The president of this company wants to increase production of family cars to at least 2000. How
does it impact this LP model?
2000 is within the range of (0 to 2222.22), this would decrease profits to 8947500 - (1950)(1050) =
7950000
Practice question 6. A bank is very concerned about the complaints it receives from the customer. A
quality control inspector compiled the data for a customer waiting times (in minutes) for the next 10
days. The summary is given below:

Day X-Bar R

1 2.856 5.22
2 3.72 5.71
3 3.49 3.83
4 3.616 2.86
5 2.604 2.11
6 2.886 3.07
7 3.354 4.02
8 2.574 1.76
9 4.314 5.08
10 2.954 1.65

The quality control manager insisted that the minimum number of samples should be for 12 days. The
inspector took two more samples, the details of which are:

Day Observation Time (min)

1 2 3 4 5 6 7
11 3.52 5.66 1.18 3.45 2.07 3.12 3.23
12 3.18 7.73 2.06 1.15 3.11 3.8 3.09

Develop an X-Bar chart to be used in conjunction with an R-chart to monitor the waiting time of
customers. Indicate if process is under control.
Practice Q uestion 7

Travel Inc bus line is proud of the 2 month intensive bus-driver training program it conducts in order to
supply drivers to other small bus lines. As long as the class size remains less than or equal to 20, the 2-
month training program costs Travel Inc. $25,600. The demand for drivers is constant at a rate of 8
drivers per month. After completing the course the drivers are paid by Travel Inc $1600 per month but do
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this as an inventory problem, an answer the following questions:

A) How large should the training classes be in order to minimize the total annual cost incurred by
Travel Inc?
Answer: 16
B) How many training classes Travel Inc should hold each year?
Answer: 6
C) What is the total annual cost associated with your recommendation?
Answer: $307200

Practice question 8
The probability distribution of demand during the lead time of a certain product is given below:

Demand During Lead Time Probability

240 0.05
260 0.10
280 0.20
300 0.30
320 0.20
340 0.10
360 0.05
1.0

The following additional data is available

Cost per unit = $10
Delivery Charges per unit = $1.50
Selling price per unit =$19
Salvage value = $7

Using the information, answer the following questions

a) Compute the optimal reorder level
Answer: 300
b) Compute the expected safety stock
Answer 0
c) What salvage value will increase the reorder level to 340?
Answer 11.11

Practice question 9

The newly appointed maintenance manager of a local manufacturing company wants to have a service
level of at least 99% for a machine lubricating oil used by many of WKHFRPSDQ\¶VPDFKLQHV)URPWKH
past data she has determined that the weekly usage of the lubricating oil is normally distributed with a
mean and standard deviation of 240 and 12 liters respectively. The lead time is fairly constant at two
weeks; currently the order point is set at 500 liters.
You are required to determine the current service level and the order point for the desired service level of
99%. Briefly comment on the economic consequences of the change in the policy (between 2-3 sentences
only).

Answer:
SL 88%

Safety stock needs to increase therefore carrying stock cost.

Practice question 10

Consider the following product structure diagram. Each component of A has only one description.
Compute how many units of F are required for three units of A

D(3)
C(2) B(2)

B(2)
E(2)

D(2) E(3)

E(3)

F(2)

Answer: 402 units

Practice Q uestion 11
A product has the following product structure tree:

E(3)
D(3)

A(1)
A(1) C(4)
B(2)

The inventory status report has just been issued for the product:

Item L ead T ime Schedule

O n H and Safety Stock A llocated Lot Size
Code (weeks) Receipt
F 800 200 200 1 LFL 400 in W2
D 600 250 150 1 LFL 700 in W3
E 1000 150 150 2 1500+ ----------
A 1500 300 200 1 400 -------
B 1200 1000 500 2 1500+ 700 in W2
C 1000 250 250 1 700 -------

The Master Production Schedule for the product (F) shows an estimated demand of 1500 units in week 4
and 6, and 3000 units in week 5. Prepare an MRP schedule for F, D, E , A and B to cover a six-week
planning horizon.

Answers:

F Releases W3-700 W4-3000 W5-1500

D Releases W2-1200 W3-9000 W4-4500
E Releases W1-1500 W2-8900 W3-4500
A Releases W1-10000 W2-13600 W3-4400 Rush order 800
B Releases W1-18000 W2-9000 Rush Order 2000
Practice Q uestion 12:

IGA Montreal purchases watermelons on a weekly basis at a cost of 50 cents

each (includes transportation) from a fruit distributor company. IGA sells
watermelons at $3 each. Each week, IGA sells watermelons only for five days
and then donates all unsold water melons to a nearby charity home that costs 10
cents each for transporting them to the charity home. The weekly demand for
watermelons is normally distributed with a daily mean of 100 and a daily
standard deviation of 10.
(a) Determine the order quantity that will maximize the
weekly profit. (b) Determine the safety stock.
(c) What is the probability of stock-out?

Practice Q uestion 13:

Consider the following product structure

 The following additional information is available from inventory status file.
ProductLead Time Lot Size Scheduled Units on Safety
Allocation
Receipt Hand Stock
F 1 week LFL 400 in wk 2 800 200 200
D 1 week LFL 700 in wk 3 600 250 150
E 2 week 1500+ --- 1000 150 150
A 1 week 400 --- 1500 1600 200
B 2 week 1500+ 750 in wk 2 1200 1000 500
C 1 week 700 --- 1000 250 250
The Master Production Schedule calls for 1000 units of item F in week 3 and
5, and 2000 in week 4. Prepare MRP record for products F, D, E, and A.

Answer:

For F

Order releases of
Planned-order Releases W2-200 W3-2000
W4-1000

For D:
Planned-order Releases W1- 400 W2-5300 W3-3000

For E:
Planned-order Releases W1-5900 W2-3000
For A:

Planned-order Releases W1-8400 W2-2800 Rush order 6800

Practice Question 14

Resistors for electronic circuits are manufactured on a high-speed automated machine. The machine is set up to
produce a large run of resistors of 1,000 ohms each.

To set up the machine and create a control chart to be used throughout the run, 15 samples were taken with four
resistors in each sample. The complete list of samples and their measured values are as follows:

Sample number Readings (in ohms)

1 1010 991 985 986
2 995 996 1009 994
3 990 1003 1015 1008
4 1015 1020 1009 998
5 1013 1019 1005 993
6 994 1001 994 1005
7 989 992 982 1020
8 1001 986 996 996
9 1006 989 1005 1007
10 992 1007 1006 979
11 996 1006 997 989
12 1019 996 991 1011
13 981 991 989 1003
14 999 993 988 984
15 1013 1002 1005 992

Develop an chart and an R chart and plot the values. From the charts, what comments can you make about the
process?

Solution:

Sample 1 2 3 4 mean range

1 1010 991 985 986 993.00 25
2 995 996 1009 994 998.50 15
3 990 1003 1015 1008 1004.00 25
4 1015 1020 1009 998 1010.50 22
5 1013 1019 1005 993 1007.50 26
6 994 1001 994 1005 998.50 11
7 989 992 982 1020 995.75 38
8 1001 986 996 996 994.75 15
9 1006 989 1005 1007 1001.75 18
10 992 1007 1006 979 996.00 28
11 996 1006 997 989 997.00 17
12 1019 996 991 1011 1004.25 28
13 981 991 989 1003 991.00 22
14 999 993 988 984 991.00 15
15 1013 1002 1005 992 1003.00 21
X 999.1, R = 21.733
Control limits for X-bar chart:
UCL, LCL = X  A2 R , = 999.1 ± .73(21.733) = 1014.965, 983.235
Control limits for R chart:
UCL = D 4 R = 2.28(21.7333) = 49.551
LCL = D3 R = 0(21.7333) = 0.00
The process is in statistical control.

Practice Question 15

The state and local police departments are trying to analyze crime rates so they can shift their patrols from
decreasing-rate areas to areas where rates are increasing. The city and county have been geographically
segmented into areas containing 5,000 residences. The police recognize that not all crimes and offences are
reported: people do not want to become involved, consider the offences too small to report, are too embarrassed
to make a police report, or do not take the time, among other reasons. Every month, because of this, the police are
contacting by phone a random sample of 1,000 of the 5,000 residences for data on crime. (Respondents are
guaranteed anonymity). Here are the data collected for the past 12 months for one area:

Month Crime incidence Sample size Crime rate

January 7 1,000 0.007
February 9 1,000 0.009
March 7 1,000 0.007
April 7 1,000 0.007
May 7 1,000 0.007
June 9 1,000 0.009
July 7 1,000 0.007
August 10 1,000 0.010
September 8 1,000 0.008
October 11 1,000 0.011
November 10 1,000 0.010
December 8 1,000 0.008

Construct a p chart for 95% confidence (1.96) and plot each of the months. What comments can you make
regarding the crime rate if the next three months show crime incidences in this area as follows?
January = 10 (out of 1,000 sampled)
February = 12 (out of 1,000 sampled)
March = 11 (out of 1,000 sampled)

Solution :

100
. P = .008333
12(1000)
P (1  P ) .008333(1.008333)
Sp = .00287
n 1000
UCL = P + 1.96 S p = .008333 + 1.96(.00287) = .01396
LCL = P - 1.96 S p = .008333 - 1.96(.00287) = .0027

The process is in control. Therefore, it can be stated that the crime rate has not increased. However, there appears
to be a gradual increase in the crime rate.

Practice Q uestion 16

Managing the inventory of fruits and vegetables is a critical aspect of operating grocery stores because they
have a limited shelf life and perish much faster than other products. James Mohan is the manager of fruits and
vegetables at Super G, an independent grocery store in the Town of Blind River. The shipment of fruit and
vegetables often arrive on Thursday morning and most items remain fresh for about a week.
One particular item of interest is the red seedless grapes. When the new shipment of grapes arrives on
Thursday, the leftover grapes of the last week are sent to the local soup kitchen. The current retail price of
grapes is $1.99 per pound and the wholesale cost, including shipping, is $1.19. Based on his knowledge and
the collected data James has prepared a probability distribution for the weekly grape demand for grapes.
 W eekly Demand (Pounds) Probability
220 0.08
230 0.20
240 0.22
250 0.27
260 0.15
270 0.08

What should be optimal order quantity of red seedless grapes to maximize expected profit from this particular
product? Support your answer with a logically developed analysis.

Solution:

This situation is the case of one-period order quantity.

Cs = Shortage cost per unit = selling price ± purchase price = 1.99 ± 1.19 = 0.80
Ce = Excess cost per unit = purchase price ± salvage price = 1.19 ± 0 = 1.19
Cs
SL = Service level = = 0.8 ÷ (1.19 + 0.80) = 0.40
Cs Ce
The cumulative probability of demand quantities are in the following table:

Weekly demand (pounds) Probability Cumulative probability

220 0.08 0.08
230 0.20 0.28
240 0.22 0.50
250 0.27 0.77
260 0.15 0.92
270 0.08 1.00
Comparing the value of SL with cumulative probabilities, it is larger than 0.28 but
not larger than 0.5. Hence the optimal order quantity is 240 pounds per week.

Practice Question 17
Cormier Orchards, located in the Niagara Region, produces a variety of fruit. Patrick Cormier, the
owner of Cormier Orchards, is also one of the founding members of the Agricultural Co-op of the
Niagara Region. The co-op provides a variety of services to its members at a very reasonable price.
Some of the services include processing fruit for the purpose of shipping to markets or converting to
juice, fruit conserve, jams, pie filling, and other products that are sold regionally. In the spring of
2006, Cormier Orchards produced 5,500 kilograms of apples, 4,800 kilograms of peaches, and 4,200
kilograms of pears. Patrick utilizes the co-op processing plant to produce the products listed in the
following table.

The table also includes the net profit per unit.

Product code Product Name Profit Per Unit

1 Apples $0.28/kg
2 Peaches $0.35/kg
3 Pears $0.37/kg
4 Peach conserves $0.56/kg
5 Pear conserves $0.64/kg
6 Apple juice $0.33/litre
7 Apple cider $0.55/litre
8 Juice blend $0.42/litre

The amount of fruit used to produce one unit of each product is listed in the next table.

Product Raw material

1 kg apples Needs 1 kg apples
1 kg peaches Needs 1 kg peaches
1 kg pears Needs 1 kg pears
1 kg peach conserves Needs 0.3 kg peaches
1 kg pear conserves Needs 0.3 kg pears
1 litre apple juice Needs 1.4 kg apples
1 litre apple cider Needs 1.8 kg apples
1 litre juice blend Needs 0.6 kg apples, 0.4 kg peaches, and 0.4 kg
pears

Other ingredients for the conserves are distilled water and sugar. There are no limitations on the
availability of distilled water and sugar. The juice blend is sold to grape growers to be used as grape
punch filler. The estimated demand for the products is as follows:

Product name Demand limits

Apples No limit
Peaches No limit
Pears No limit
Peach conserves 1,000 kg
Pear conserves 800 kg
Apple juice 1,200 litre
 Apple cider 500 litre
Juice blend 3,000 litre

Required
Prepare a linear programming model to maximize Patrick¶s net profit for the season. Make sure that
your response includes the definition of decision variables (3 marks), the objective function (3
marks), and all the inequality relationships to account for the required constraints (6 marks). You are
only required to prepare the model. You are not required to solve the model to find the optimal
production plan.

Solution:

The decision variables include the amount of each of the eight products to be
produced.
Use the product codes (given in the problem) to identify each variable. Pay
special attention to the units (kilograms and litres) used for each decision variable.
Without them the definition is not complete.

X1 = Number of kilograms of apple fruit produced

X2 = Number of kilograms of peach fruit produced
X3 = Number of kilograms of pear fruit produced
X4 = Number of kilograms of peach conserve produced
X5 = Number of kilograms of pear conserve produced
X6 = Number of litres of apple juice produced
X7 = Number of litres of apple cider produced
X8 = Number of litres of juice blend produced

Objective function

Max 0.28 X1 + 0.35 X2 + 0.37 X3 + 0.56 X4 + 0.64 X5 + 0.33 X6 + 0.55 X7 +

0.42 X8

Note that the unit of objective function is ʊGROODUVԡ

Constraints

We have three constraints on the availability of raw material (harvested fruits)

and five market caps on the demands for 5 of the products, plus the non-negativity
constraint on all variables with which to prepare the inequality relationships.
X1 + 1.4 X6 + 1.8 X7 + 0.6 X8 ” 5,500 harvested apples
X2 + 0.3 X4 + 0.4 ;”,800 harvested peaches
X3 + 0.3 X5 + 0.4X8 ” 4,200 harvested pears
X4 ” 1,000 market cap for peach conserve
X5 ” 800 market cap for pear conserve
X6 ” 1,200 market cap for apple juice
X7 ” 500 market cap for apple cider
X8 ” 3,000 market cap for juice blend
All Xs • 0

So, the complete model would be as follows:

Max 0.28 X1 + 0.35 X2 + 0.37 X3 + 0.56 X4 + 0.64 X5 + 0.33 X6 + 0.55 X7 +

0.42 X8
s.t.
X1 + 1.4 X6 + 1.8 X7 + ;”5,500 harvested apples
X2 + 0.3 X4 + 0.4 ;”,800 harvested peaches
X3 + 0.3 X5 + 0.4 X8 ” 4,200 harvested pears
X4 ” 1,000 market cap for peach conserve
X5 ” 800 market cap for pear conserve
X6 ” 1,200 market cap for apple juice
X7 ” 500 market cap for apple cider
X8 ” 3,000 market cap for juice blend
All Xs • 0
Practice Question 18

The bill of materials for products A and B are shown below. The MPS calls for 100 units of
product A to be completed in week 6. Item A has a 2 week lead time. The MPS calls for 300
units of product B in week 5 and 100 units in week 7. End item B has a 1 week lead time.
Develop and MRP for all items (A, B, C, D, E and F) (Note: Assume that A and B have no initial
inventory).

B
A

C(1)
C(2) D(2)
E(1)

E(1)
F(1)

F(1)

Item L ead T ime Schedule

O n H and Lot Size
Code (weeks) Receipt
C 100 1 FOQ=250 450 in W1
D 70 2 LFL 50 in W5
E 50 2 PO Q = 4 ----------
F None 1 LFL 50 in W3

Answer:

For A

Planned-order Releases W4-100

For B
Planned-order Releases W4-300 W6-100

For C:
Planned-order Releases W5-250

For D:
Planned-order Releases W2-530 W4-150
For E:
Rush order 730
For F:
Rush order 730