Sahand is a phone production company. It produces 25 types of phones. All phones are similar. In Table-1, forecasts for the phones and the number of working days for the next six months are given. There are currently 27 full time workers and each worker produce 4 phones per day. At the beginning of each month, new full time workers are hired at a cost of 300 TL and existing workers can be fired at a cost of 480 TL. Wages consist the majority of the total cost and workers are paid 100 TL per day including insurance, meal and transportation. In other words, wages may change from one month to another month. All demand must be satisfied on time. Assume that there is no backorders and lost sales. The inventory holding cost is 1 TL per item per month
Write an LP model to minimize total cost.
- Define decision variables clearly
- Write explanations for each constraints