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Please help me solve this problem step by step and clearly, thanks! (18%) An IE engineer wishes to determine whether a subassembly of a product
Please help me solve this problem step by step and clearly, thanks!
(18\%) An IE engineer wishes to determine whether a subassembly of a product is to be made in the plant or manufactured by an outside supplier. The data is shown as followed: The carrying cost per unit is $0.50 per day and the shortage cost per unit per day is $0.20. How should the engineer decide on ordering the subassembly, assuming 260 working days per year. a. (5\%) If the annual demand is 30,000 units? b. (5\%) If the annual demand is 20,000 and the shortage cost per unit is $0.15 independent of the period? c. (8\%) Assuming that the annual demand is 20,000 units and that vendor 1 provides a quantity discount as shown belowStep by Step Solution
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