Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Hukkahuya is a leading manufacturer of pink cricket balls. The pink coloured ones are used for daynight matches. Hukkahuya is looking at its production plan
Hukkahuya is a leading manufacturer of pink cricket balls. The pink coloured ones are used for daynight matches. Hukkahuya is looking at its production plan over a 6month planning horizon. Demands are 10, 15, 30, 35, 25 and 10 (in '000 units) and they need to be met in time. Hukkahuya has a current inventory of 5000 pink cricket balls. We may assume that the demand at the end of month, while production occurs during the month. Hukkahuya has a maximum monthly capacity of producing 30000 such cricket balls. It has a storage capacity of 10000 cricket balls. The production cost (per pink cricket ball) over the next 6 months is $ 12.50, 12.55, 12.70, 12.80, 12.85, 12.95 respectively. On any given month, the storage cost is 5% of production cost of that month The selling price is fixed and hence not relevant. So Hukkahuya needs to decide on its schedule to minimize production and holding cost
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started