1. Rocky Mountain Tire Company sells 20,000 go-cart tires per year. The ordering cost (cost to place a purchase order) for each order is $60, and the holding cost is 10% of the purchase price of the tire per year. They use a single supplier for their tires. The purchase price is $24 per tire. Given the above information, please answer the following questions: a) How many tires should Rocky Mountain order each time they place an order? You need to calculate the EOQ. b) What would the total cost of this order quantity be? You need to calculate the annual order cost (AOC) and annual holding cost (AHC). 2. M.P. VanOyen Manufacturing has gone out on bid for a regulator component. Expected usage for this component is 8,400 units per year. There are two suppliers on the market that offer the regulator component required by VanOyen: Allen Manufacturing and Bearkat Manufacturing. The cost for placing an order at either of these companies is $50 per order, and the holding cost per unit is 30% of the item's purchase price annually. The prices offered by each firm are shown in the table below: Quantity 1-499 Allen Bearkat Unit Price Quantity 16.00 1-399 500+ 15.50 400+ Given the above information, please answer the following questions: Unit Price 16.10 15.60 a) What is the economic order quantity (EOQ) for each supplier individually? b) Which supplier will M.P. VanOyen end up using? Why? 3. First Printing has contracts with legal firms in Houston to copy their court documents. Daily demand is constant at 12,500 pages of documents per day. First Printing orders their paper from a local supplier that has a lead time which is normally distributed with a mean of 4 days. The standard deviation of demand is 1,000 day. First printing expects a 98% service level from their supplier (use the Z score of 2.055. Given this information, what is the Reorder Point (ROP) for paper?

1. Rocky Mountain Tire Company sells 20,000 go-cart tires per year. The ordering cost (cost to place a purchase order) for each order is $60, and the holding cost is 10% of the purchase price of the tire per year. They use a single supplier for their tires. The purchase price is $24 per tire. Given the above information, please answer the following questions: a) How many tires should Rocky Mountain order each time they place an order? You need to calculate the EOQ. b) What would the total cost of this order quantity be? You need to calculate the annual order cost (AOC) and annual holding cost (AHC). 2. M.P. VanOyen Manufacturing has gone out on bid for a regulator component. Expected usage for this component is 8,400 units per year. There are two suppliers on the market that offer the regulator component required by VanOyen; Allen Manufacturing and Bearkat Manufacturing. The cost for placing an order at either of these companies is $50 per order, and the holding cost per unit is 30% of the item's purchase price annually. The prices offered by each firm are shown in the table below: Given the above information, please answer the following questions: a) What is the economic order quantity (EOQ) for each supplier individually? b) Which supplier will M.P. VanOyen end up using? Why? 3. First Printing has contracts with legal firms in Houston to copy their court documents. Daily demand is constant at 12,500 pages of documents per day. First Printing orders their paper from a local supplier that has a lead time which is normally distributed with a mean of 4 days. The standard deviation of demand is 1,000 day. First printing expects a 98% service level from their supplier (use the Z score of 2.055. Given this information, what is the Reorder Point (ROP) for paper