NorCal Outfitters manufactures a variety of specialty gear for outdoor enthusiasts. NorCal has decided to begin production on two new models of crampons: the Denali and Cascade. The company produces crampons by first stamping steel sheets into the rough design, then assembling the base crampon with toe and ankle straps. NorCal’s manufacturing plant has 120 hours of stamping time and 80 hours of assembly time assigned for producing these crampons.
Each set of Denali crampons requires 30 minutes of stamping time and 25 minutes of assembly time, and each set of Cascade crampons requires 25 minutes of stamping time and 15 minutes of assembly time. The labor and material cost is $15 and $10 for each set of Denali and Cascade crampons, respectively. NorCal sells crampons through wholesale distributors for $55 for the Denali model and $45 for the Cascade model. The V.P of Production at NorCal believes that the Denali model, recently featured in Outside Magazine, could become a bestseller and has determined that at least 60% of the crampons produced by NorCal should be the Denali model.
1. Solve this problem using the graphic solution technique.
2. How many units of each model can NorCal manufacture to maximize the total profit and meet all constraints?
3. How much profit can NorCal expect to make with these two models of crampons?
4. How well has NorCal balanced its production hours assigned to stamping and assembly?
5. How much more profit can NorCal make if it lowers its production requirement of Denali crampons from 60% to 40%?