a A company knows that the demand for its product during each of the next three months will be as follows: 1 unit, 3 uni

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A A Company Knows That The Demand For Its Product During Each Of The Next Three Months Will Be As Follows 1 Unit 3 Uni 1 (38.57 KiB) Viewed 37 times

a A company knows that the demand for its product during each of the next three months will be as follows: 1 unit, 3 units, and 2 units, respectively. At the beginning of each month, the company must determine how many units should be produced. During any month, if units are produced, a setup cost of $3 is incurred. In addition, there is a variable cost of $1 for every unit produced. At the end of each month, a holding cost of $0.75 per unit is incurred for on-hand inventory. Capacity limitations allow a maximum of 5 units to be produced each month. The size of the company's warehouse restricts the ending inventory each month to 2 units at most. Assume that'l unit is on hand at the beginning of the first month. Determine a production schedule that will meet all demands on time and will minimize the sum of the production and holding costs during the three months,