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Write down the characteristics of the parameters

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Dipswitch Electronics, Inc. produces a special purpose computer chip in lots. The chip can be produced at a rate of 1600 per day. Demand for the chip is constant at 400 per day. The cost of setting up the facility for a production run is $800.00. The annual inventory carrying charge rate is 0.25, and the unit cost for the chip is $1.00.

(a) Write down the characteristics of the parameters, i.e., is the demand deterministic or stochastic and so on.

(b) What is the optimal lot size?

(c) How long will a production run last?

(d) If the setup takes one day (24 hours), what percent of the time is the facility free to produce other chips?

Reference no: EM132807386

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