The holding cost of a refrigerator is $ 50 per year

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Reference no: EM13712691

The annual demand has been about 8,000 units each year, and this demand has been constant throughout the year. The production capacity is 200 units per day. Each time production starts, it costs the company $ 120 to move materials into place, reset the assembly line, and clean the equipment. The holding cost of a refrigerator is $ 50 per year. The current production plan calls for 400 refrigerators to be produced in each production run. Assume there are 250 working days per year.

Reference no: EM13712691

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