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(a) INVENTORY MANAGEMENT. Price-Break or Quantity Discount Model. (15 points) PT ABAH demands 1,200 electric drills per year. The ordering cost is S = Rp

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(a) INVENTORY MANAGEMENT. Price-Break or Quantity Discount Model. (15 points) PT ABAH demands 1,200 electric drills per year. The ordering cost is S = Rp 1,500,000.- per order and the carrying cost, etc. is i = 35% of cost per unit. If the order is fewer than 150 units, the cost per unit is C = Rp. 1,150,000. If the order is 150 or more, the quantity discount cost per unit is C = Rp 750,000. Calculate the economic order size or EOQ or Qif C = Rp. 1,150,000. Is that feasible? Explain. Calculate the economic order size or EOQ or Q if C = Rp. 750,000. Is that feasible? Describe. Should ABAH take advantage from the quantity discount? Explain. (b) Explain and draw cross docking vs. non cross docking. Describe at least 2 benefits of cross-docking. (5 points) (c) Process Analysis/Bottleneck Analysis/Theory of Constraints (TOC)/ Synchronous Manufacturing (5 points) Suppose a company has 4 departments as follow: ABCD Capacity: A = 66 units/hr.; B = 78 units/hr.; C = 54 units/hr.; D = 85 units/hr. Which department is the bottleneck department? What is the system output in units/hr.? If you would like to increase the system output, which department is the focus of your improvement effort? Why

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