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ABC Co manufactures a subcomponent at the rate of 400 per day when required. Its annual demand for this item is 50000 unites. Assume 250 working days per year. Holding cost is $10 per unit per year. Set-up cost is $150 per set-up.
Find
A) Economic production quanity.
B) How many production runs will be made per year.
C) What will be the maximum inventory level.
D) What percentage of time during the year will this item be produced
E) What is the annual cost for ordering and holding inventory
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1. A jewelry firm buys semiprecious stones to make bracelets and rings. The supplier charges $20 per stone, annual carrying costs are 50%, and the cost of processing orders is $40.
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