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The manager of a stamping department is getting ready to begin a new operation. A single product is to be produced. It can be produced on any of the three machines.
Information concerning the machines is contained in the following table:
| Machine | Setup costs | Profit Per Unit | Daily Capacity |
| A | $300 | $10 | 500 |
| B | $250 | $12 | 450 |
| C | $325 | $13 | 450 |
Each machine requires an operator, and two operates are available. The profit per unit excludes setup cost, and setups must be done at the start of each new day.
a) Formulate algebraically this profit maximization problem for the optimal quantities to produce per day on each machine. Define the decision variables, objective function, and constraints.
b) Formulate this same problem on a spreadsheet and SOLVE using Excel Solver (Provide the corresponding ”Excel Spreadsheet” and ”Answer Report”). Describe clearly and completely the optimal solution to this problem using a managerial statement.
