About explain how many runs per year would there be

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Reference no: EM1374960

Q. A chemical industry produces sodium bisulphate in 100-pound bags. Demand for this product is 20 tons per day. Capacity for producing product is 50 tons per day. Setup costs $100 and storage and handling costs are $5 per ton a year. Industry operates 200 days a year. (Note: 1 ton = 2,000 pounds).

a. Explain how many bags per run are optimal?

b. Illustrate what would average inventory be for this lot size?

c. Determine approximate length of a production run, in days

d. About explain how many runs per year would re be?

e. Explain how much could business save annually if setup cost could be reduced to $25 per run?

Reference no: EM1374960

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