posted by Lena on .
The Furniture Co has two plants. The Eastside one makes Table and Chairs for school classrooms and the Westside one makes Desks and Computer Workstations. (See tables attached in excel).
The Furniture Co is considering combining operations of both plants into a single one. This consolidation will combine the weekly available resources so that 12,000 sq.ft. of pressed wood, 800 boxes of aluminum fittings and 600 production hours will be available weekly . However the accounting department estimates the cost of renovating the plant will be $5000/weekly , on an amortization bases.
1. Find the optimal solution for each plant separately.
2. Analyze the recommendations to Furniture Co for combining operations at both plants into a single plant.
We don't see the excel file, so are not able to process the given data.
However, I assume the file gives the resources, namely the number of square feet of plywood, boxes of aluminium fittings and the number of production hours for each plant, together with the required resources and profit for each product.
To solve the problem, you would set up a simplex tableau for each plant, and solve both to get the total production, or rather the total profit.
Repeat the same exercise for the combined plant and compare profitability.