Response to the following:
China Wu Yi Ltd is able to produce four products and is planning its production mix for the next period. Estimated cost, sales and production data are given below:
Product Debreu Exe Wye Zed
Sh. Sh. Sh. Sh.
Selling price/unit 320 380 680 560
Direct Labour @ 6/hr 180 120 420 300
Direct Material @Ksh.1/Kg 60 180 100 120
80 80 160 140
Resource/unit
Labour (hours) 3 2 7 5
Material (Kg) 6 18 10 12
Maximum demand (units) 5000 5000 5000 5000
Required: Based on the above data what is the most appropriate mix under the two following assumptions
(a) If labour hours are limited to 42,000 in a period.
(b) If material is limited to 80,000 Kg in a period