EquiBags makes equipment bags for professional camera equipment, and it offers two models: regular and deluxe. The company has a prior pricing agreement with a distributor who is willing to buy as much of each kind of bag as it can make. There are three steps in making a bag: cutting, sewing, and finishing. Each regular bag requires 1 hour in cutting, 1.25 hours in sewing, and 0.75 hours in finishing. Each deluxe bag needs 2 hours in cutting, 1.75 hours in sewing, and 0.5 hours in finishing. The profit obtained for each regular bag is $10, while that for each deluxe bag is $15. The director of manufacturing estimates that 630 hours for cutting, 600 hours for sewing, and 708 hours for finishing will be available during the next production cycle. To maximize profit, the company needs to determine the optimal number of regular and deluxe bags to produce in the next production cycle. Algebraically, formulate a linear programming model that determines the optimal number of regular and deluxe bags that EquiBags needs to produce in the next production cycle.
Formulate your linear program in Excel and use the solver to solve it.
Should EquiBags hire more employees to increase its finishing capacity? Why? How about the sewing capacity? Why?