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A manufacturer produces three products on one machine. No other products are assigned to this equipment. The holding cost is $2/$.year and the data for
A manufacturer produces three products on one machine. No other products are assigned to this equipment. The holding cost is $2/$.year and the data for the items are given in the following table. Assuming each product is produced each cycle, there are 24 hours in one day and 250 days in one year, approximately what is the optimal order quantity for product 1? Item 1 2 3 6,000 1,200 4,000 30 40 50 D; (units/year) vi ($/unit) Pi(units/year) S;($) K; (hour) 30,000 10,000 16,000 30 50 40 16 18 20 Hi ($) 144,000 42,240 150,000 O a. 76 b. 97 O c. 113 d. 126 e. 84
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