Montpelier is planning its production of skis for the months of July, August, and September. Production capacity and unit production cost will change from month to month. Production levels should meet both demand forecasts and end-of-quarter inventory requirement in every month. Skis can be stored in a warehouse to satisfy demand in later months. An inventory holding cost will be incurred in that case. Initial inventory at the beginning of July = 200 pairs. Ending inventory required at the end of September =800 pairs. Holding cost per month per ski is $0.5.Month Demand Production Capacity Unit Production CostJuly 300 1000 25August 500 800 26September 700 400 29Management would like to schedule production to minimize its costs for the quarter.(a) Formulate the problem mathematically by clearly defining the decision variables, objective function and constraints.(b) Implement this problem in excel to solve for the optimal solution.

of the three mortgage options that demarco and tanya have to choose from, the balloon payment mortgage would be their best option, over adjustable payment and fixed payment plans.ultimately, the balloon payment plan would save demarco and tanya overall, in interest, would cost less monthly, and they would only have to make these payments for 8 years, opposing to 30 years for adjustable or fixed payment plans. 

overall, demarco and tanya would save $80,811 if they chose balloon payments over fixed payments, and would save $116,711 if they choose balloon payments over adjustable payments. benefits with choosing fixed payments over adjustable payments is that, in the end, the payments will still be $836.30 a month, while with adjustable payments, the initial monthly payments will be $763.38 to $1082.70 a month, ultimately leading to a more costly purchase. benefits with choosing fixed payments over balloon payments are not present. benefits in choosing adjustable payments over is that it has a lower interest rate, and starts with lower monthly payments initially. benefits in choosing adjustable payments over balloon payments include a lower interest rate, and lower initial monthly payments. benefits in choosing balloon payments over fixed payments include lower interest rates, lower overall price, lower monthly payments, takes less time to pay off, and does not require a downpayment. benefits in choosing balloon payments over adjustable payments include, lower monthly payments (when averaged), takes less time to pay off, and lower overall price.

hence, option c, balloon payments, is the best option for demarco and tanya to make this purchase, for it will save them a minimum of $80811, and a maximum of $116,711.