Hansen Controls Has Been Awarded a Contract for a Large

question 16

Essay

Hansen Controls has been awarded a contract for a large number of control panels. To meet this demand, it will use its existing plants in San Diego and Houston, and consider new plants in Tulsa, St. Louis, and Portland. Finished control panels are to be shipped to Seattle, Denver, and Kansas City. Pertinent information is given in the table. $\begin{array}{l|c|rcc|c}&&&(\text { Shipping Cost to Destination: }&\\&\text { Construction }&&&\text { Kansas }\\\text { Sources } & \text { Cost } & \text { Seattle } & \text {Denver } & \text { City } & \text { Capacity }\\\hline \text { San Diego } & \cdots & 5 & 7 & 8 & 2,500 \\\text { Houston } & \cdots & 10 & 8 & 6 & 2,500 \\\text { Tulsa } & 350,000 & 9 & 4 & 3 & 10,000 \\\text { St. Louis } & 200,000 & 12 & 6 & 2 & 10,000 \\\text { Portl and } & 480,000 & 4 & 10 & 11 & 10,000\\\hline&\text { Demand }& 3,000 & 8,000 & 9,000\\\end{array}$ Develop a model whose solution would reveal which plants to build and the optimal shipping schedule.

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Definitions:

Statute Law

Written laws passed by a legislative body, forming part of a country’s legal framework.

Consideration

A concept in contract law that refers to something of value that is exchanged between parties to a contract, making the agreement legally binding.

Charitable Pledge

A commitment to donate a specific sum of money to a charitable organization, often payable over a certain period.

Past Consideration

A term used in contract law that refers to an act or benefit given in the past, which cannot be used as consideration for a current contract.