3. A company produces a small component for an industrial product and distributes it to five [3] wholesalers at a fixed

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3 A Company Produces A Small Component For An Industrial Product And Distributes It To Five 3 Wholesalers At A Fixed 1 (38.38 KiB) Viewed 30 times

3. A company produces a small component for an industrial product and distributes it to five [3] wholesalers at a fixed delivered price of 2.5 per unit. The sales forecasts indicate that the monthly deliveries will be 3,000, 3.000, 10,000, 5,000 and 4,000 units to wholesalers I, II, III, IV and V respectively. The company's monthly daily production capacities are 5,000, 10,000 and 12,500 at plants 1, 2 and 3 respectively. Respective direct costs of production of each unit are 2 1, 2 0.9 and 2 0.8 at plants X, Y and Z. Transportation costs of shipping a unit from a plant to a wholesaler are as follows: Wholesaler II III IV V I 0.05 X 0.07 0.1 0.25 0.15 D Plant Y 0.08 0.06 0.09 0.12 0.14 Z 0.1 0.09 0.08 0.1 0.15 Find how many components each plant should supply to each wholesaler in order to maximise the profit. Page 1 of 6