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Question 1

Question 1

Net ProfitPlantsCapacity ConfigurationPlant
Products12Products12Demand
Demand: A: 1000; B: 1000A710A1000
Probability: 0.25B64B1000
Profit:Capacity20002000
Demand A: 1000
Net ProfitPlantsCapacity ConfigurationPlant
Demand: A: 1000; B: 3000Products12Products12Demand
Probability: 0.25A710A1000
Overall Expected Profit:B64B3000
StartProfit:Capacity20002000
Net ProfitPlantsCapacity ConfigurationPlant
Demand: A: 3000; B: 1000Products12Products12Demand
Probability: 0.25A710A3000
B64B1000
Demand A: 3000Profit:Capacity20002000
Demand: A: 3000; B: 3000Net ProfitPlantsCapacity ConfigurationPlant
Probability: 0.25Products12Products12Demand
A710A3000
B64B3000
Profit:Capacity20002000

Hint:
Step 1: Under each demand scenario, try to figure out how much to produce for products A and B in Plants 1 and 2 in the gray area. The production plan you propose should maximize the profit under this demand scenario.
Step 2: Calculate the corresponding profit given the production plan you proposed in the light blue area.
Step 3: Calculate the overall expected profit that summarizing all the demand senarios. Report it in the light green area.
Step 4: Answer the following questions in the textbox.

Question: Why the capacity at these plants is sometimes larger than the demand?

Your answer:

Question 2

Question 2a:

Your answer:

Question 2b:

Your answer:

Question 2c:

Your answer:

image1.png

image2.png

image3.png

image4.png

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