Question
1. Compute the economic production lot size for the Dash 500. 2. Given your answer to the first requirement, what is the total cost of
1. Compute the economic production lot size for the Dash 500.
2. Given your answer to the first requirement, what is the total cost of setting up the production runs and carrying inventory for one year?
3. Assume that the company has been able to reduce setup costs for each production switch from one product to another to $200.
Also assume that when the waste and inefficiency caused by inventories is also considered, the cost to carry one Dash 500 in inventory jumps to $20 per unit. Under these conditions, what is the economic production lot size for the Dash 500?
i need step by step explanation plus answer thanks.
ivities: App 9A EOQ I Saved Exercise 9A-1 Economic Production Lot Size (LO5] Sky High manufactures drones for recreational use. Its most popular model is the Dash 500 with 2,000 units produced each year. Setup costs are $400 to switch production from one drone model to another. It costs $10 to carry one Dash 500 in inventory for a year. Required: 1. Compute the economic production lot size for the Dash 500. Economic production drones 2. Given your answer to the first requirement, what is the total cost of setting up the production runs and carrying inventory for one year? The total cost setup Canying inventory for one year 3. Assume that the company has been able to reduce setup costs for each production switch from one product to another to $200. Also assume that when the waste and inefficiency caused by inventories is also considered, the cost to carry one Dash 500 in inventory jumps to S20 per unit. Under these conditions, what is the economic production lot size for the Dash 500? Economic production drones UCL 61 MSStep by Step Solution
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