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Aunt Fannie's Pie Company produces fruit pies for freezing and subsequent sale. The company operates 5 days per week, for 52 weeks, which works out
Aunt Fannie's Pie Company produces fruit pies for freezing and subsequent sale. The company operates 5 days per week, for 52 weeks, which works out to 260 days per year. Pies can be produced at the rate of 64 pies per day. The company sets up pie production and produces until a predetermined number (Q) of pies have been produced. When not producing pies, Aunt Fannie's uses its personnel and facilities for producing other items. The setup cost for a production run of fruit pies is $500 and the lead time is 5 working days. The holding rate is 50% (high due to using freezers) and each pie costs $10 to make. The annual demand for frozen fruit pies is 5000 pies, with a constant daily demand. A-what is the economic production lot size Q? B-what is the total annual inventory cost? C-what is the optimal number of production runs per year? D-what is the cycle time
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