Discuss the below:
Q: A gear manufacturer is planning next week production run for four types of gears. If necessary, it is possible to outsource any type of gear from another gear company located down the street. For each type of gear, the table at the bottom of this page shows next week demand, revenue per unit, outsource cost per unit, and time (in hours) required per unit in each production process:
If the hours in the three production departments are not used in the making these gears, they can be used for some other products. Gary can supply a maximum of 300 units of each type of gear next week. What should be the production and/or outsource plan for the next week to maximize profit?
Gear Type Gear A Gear B Gear C Gear D
Demand 400 500 450 600
Revenue $12.50 $15.60 $17.40 $19.30
Outsource $7.10 $8.10 $8.40 $9.00
Process Gear A Gear B Gear C Gear D
Hours Available Cost per Hour
Forming 0.30 0.36 0.38 0.45 500 $9.00
Hardening 0.20 0.30 0.24 0.33 300 $8.00
Deburring 0.30 0.30 0.35 0.25 310 $7.50