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What is the cycle time

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Reference no: EM13722079

Question 1 Frank's machine shop operates 250 days per year. Frank sells 5,000 units per year of his most popular item, a specialty gear. The set-up cost for this gear is £100 and the monthly unit cost of holding inventory is 1% of the production cost per unit, which is £50.

The lead time is 10 days. When the gear is being produced, the shop can make 80 gears per day

Complete the following:

1. How many gears should be produced in each run and at what minimum cost?

2. What is the cycle time?

3. Find the reorder point. 4.Draw a graph to depict inventory level against time and show on it the quantities found above. Also, what is the maximum inventory level?

Question 2

Discussion questions in the case study (Dell's Value Chain) in the Heizer and Render textbook.

Reference no: EM13722079

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