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Meltdown Electronics Instructions

Meltdown Electronics manufactures three power line test equipment models - the Z-100, Z-200, and ZX-1000 - in a Fabrication department and Assembly department. The departments have different production capacities for each model. The firm receives $60 contribution for each Z-100, $60 for each Z-200, and $100 for each ZX-1000 produced. A key component, the X37, is in short supply due to a supplier strike, limiting production. The factory has 4,000 X37 components in stock.

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208 views1 page

Meltdown Electronics Instructions

Meltdown Electronics manufactures three power line test equipment models - the Z-100, Z-200, and ZX-1000 - in a Fabrication department and Assembly department. The departments have different production capacities for each model. The firm receives $60 contribution for each Z-100, $60 for each Z-200, and $100 for each ZX-1000 produced. A key component, the X37, is in short supply due to a supplier strike, limiting production. The factory has 4,000 X37 components in stock.

Uploaded by

Joli Smith
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Meltdown Electronics

Meltdown Electronics a manufacturer of power line test equipment, has a factory that produces its most
successful product line, which consists of three models: the Z-100, the Z-200, and the ZX-1000. These
models are produced in two departments: Fabrication, in which equipment chassis are fabricated from
sheet steel, and Assembly.

Department Z-100 Z-200 ZX-1000 Capacity


Fabrication 4.0 0 11.5 6000
Assembly 2.4 3.4 2.4 2000

The Z-200 does not go through fabrication, but is assembled into a cabinet purchased from a
subcontractor. The firm receives $60 in contribution for each Z-100 it produces and sells, $60 for each Z-
200, and $100 for each ZX-1000.

Demand is sufficiently strong that the firm can sell whatever it produces. However, due to a strike that
has hit one of its suppliers, the factory is short of X37’s, a key component in each of the three models.
The Z-100 requires 4 X37’s, the Z-200 requires six, and the ZX-1000 requires nine. Currently, 4,000 X37
components are in stock.

1) Formulate the problem as an LP and find its optimal solution.


2) A small local electronics contractor has offered to sell the factory X37’s at $5 apiece. Should the
firm agree to the purchase? If so, how much additional contribution can the firm expect per unit
of an additional X37.
3) The sales manager insists that the loss of customer goodwill, which would accompany dropping
Z-200’s from the line, might be significant. She suggests producing at least 10 of this model.
What effect would this have on the firm’s contribution?
4) A neighboring manufacturer of medical test equipment, also strained by capacity, has offered to
pay MeltDown $10 per hour if it will assemble some of their models. They will provide the
necessary wiring components and chassis. Should the plant manager agree to this request?

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