The State University power plant burns coal to generate steam and electricity for campus buildings. It takes

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The State University power plant burns coal to generate steam and electricity for campus buildings. It takes three days to transport coal by railroad from the coalfields, and the cost of shipping and handling coal by rail is $19.50 per ton. The coal demand for the coming year is forecasted to be 48,000 tons, and the annual handling and storage cost at the Tech power plant is $112 per ton. Determine the power plant’s ordering policy and total annual inventory cost.

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Operations and Supply Chain Management

ISBN: 978-1119444404

9th edition

Authors: Roberta S. Russell, Bernard W. Taylor

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