The company also has the option to obtain additional units from a subcontractor, who has offered to supply up to 20,000 units per month in any combination of electric and battery-operated models, at a charge of $21.50 per unit. For this price, the subcontractor will test and ship its models directly to the retailers without using Acme’s production process.
a. What are the maximum profit and the corresponding make/buy levels? (Fractional decisions are acceptable.)
b. Suppose that Acme requires that the solution provided by the model be implementable without any rounding off. That is, the solution must contain integer decisions. What are the optimal make/buy levels?
c. Is the solution in part (b) a rounded-off version of the fractional solution in part (a)?
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