Reference no: EM13762507

Q1. A producer has to supply 12,000 units of a product per year to his customer. The demand isfixed and known and backlogs are not allowed. The inventory holding cost is Rs.0.20 per unit per month and the set up cost per run is Rs. 350/- per run. Determine
(a) the optimal lot size,
(b) Optimum scheduling period,
(c)Minimum total expected yearly cost.

Q2. A company uses 1,500 per year of a certain subassembly that has an annual holding cost of $45 per unit. Each order placed costs $150. The company operates 300 days per year and it has found that an order must be placed with the supplier 6 working days before it can expect to receive that order. For this subassembly, find:
(a) the economic order quantity.
(b) the annual holding cost.
(c) the annual ordering cost.
(d) the reorder point.