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ohaa [14]
4 years ago
12

Furnco manufactures desks and chairs. Each desk uses 4 units of wood, and each chair uses 3 units of wood. A desk contributes $4

0 to profit and a chair contributes $25. Marketing restrictions require that the number of chairs produced be at least twice the number of desks produced. There are 20 units of wood available. Furnco wants to maximize its profit. Formulate a LP model for Furnco in a spreadsheet and solve it to find out how many desks and how many chairs it should produce.
Business
1 answer:
marshall27 [118]4 years ago
5 0

<u>Explanation</u>:

This is an example of a linear programming problem.

THE CONSTRAINTS

Let d, c represents number of desk and chair.

Marketing restrictions

c ≥ 2d; which can be written as

2d - c ≤0

Wood restriction

4d + 3c ≤ 20

OBJECTIVE FUCTION (MAX)

= 40d + 25c

Where d ≥ 0, c ≥ 0

With this details you can then find the solutions either graphically or using  any other linear programming solution methods.

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Answer:

Machine A; because it will save the company about $13,406 a year

Explanation:

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Equate Annual Cost = PV of Cash Outflow ÷  PVAF (r%, n)

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Year            CF          PVF  at 14.6%           Disc CF

0            $3,18,000.00    1.0000                 $3,18,000.00

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PV of Cash Outflow                            $1,47,053.69

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Year             CF                PVF at 14.6%                  Disc CF

0              $2,47,000.00       1.0000                    $2,47,000.00

1                $9,300.00       0.8726                        $8,115.18

2               $9,300.00       0.7614                        $7,081.31

PV of Cash Outflow                                          $2,62,196.49

PVAF(14.6%,2)              1.6340

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