Fixed-Cost Models In Manufacturing Glass: The Case Of Juleno Crystals

Abstract

The Juleno Crystals case illustrates how spreadsheet modeling can be used to solve linear programming problems without the use of algebraic formulations. It also enriches students’ knowledge on how to use integer linear programming with binary (0-1) variables in dealing with problems that include fixed costs. Binary variables are often used to transform a nonlinear model into a linear (integer) model. Students completing the Juleno Crystals case will be able to develop a spreadsheet model that will maximize the company’s profit while correctly incorporating fixed costs and staying within the limits of the available resources.