Question
PolarAir Inc. repairs and maintains air conditioners. This often involves replacing the main AC capacitor, a crucial electronic component. PolarAir replaces about 1,000 capacitors per
PolarAir Inc. repairs and maintains air conditioners. This often involves replacing the main AC capacitor, a crucial electronic component. PolarAir replaces about 1,000 capacitors per year and its supplier charges the company $40 per capacitor. Handling and freight costs are $150 per order. Answer the following questions, given that the carrying cost of AC capacitors is $5 per unit:
How many capacitors should PolarAir order, each time it places an order?
How many capacitors should PolarAir have in stock when it places an order, if it takes the supplier 10 working days to process the order and deliver the capacitors?Since PolarAir does not operate on weekends, you should assume that there are 250 days in a year.
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