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Emarpy Appliance is a company that produces all kinds of major appliances. Bud Banis, the president of Emarpy, is concerned about the production policy for
Emarpy Appliance is a company that produces all kinds of major appliances. Bud Banis, the president of Emarpy, is concerned about the production policy for the company's bestselling refrigerator. The annual demand for this has been about units each year, and this demand has been constant throughout the year. The production capacity is units per day. Each time production starts, it costs the company $ to move materials into place, reset the assembly line, and clean the equipment. The holding cost of a refrigerator is $ per year. The current production plan calls for refrigerators to be produced in each production run. Assume there are working days per year.
a What is the daily demand of this product?
b If the company were to continue to produce units each time production starts, how many days would production continue?
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