Essay
Comfort Plus Inc.(CPI)manufactures a standard dining chair used in restaurants.The demand forecasts for quarter 1 (January-March)and quarter 2 (April-June)are 3700 chairs and 4200 chairs,respectively.CPI has a policy of satisfying all demand in the quarter in which it occurs.The chair contains an upholstered seat that can be produced by CPI or purchased from DAP,a subcontractor.DAP currently charges $12.50 per seat,but has announced a new price of $13.75,effective April 1.CPI can produce the seat at a cost of $10.25.CPI can produce up to 3800 seats per quarter.
Seats that are produced or purchased in quarter 1 and used to satisfy demand in quarter 2 cost CPI $1.50 each to hold in inventory,but maximum inventory cannot exceed 300 seats.
Formulate this problem as a linear programming problem.
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