Use Excell/Decision Table

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 best-selling refrigerator. The annual demand for this has been about 8,000 units each year, and this demand has been constant throughout the year. The production capacity is 200 units per day. Each time productionstarts, it costs the company $120 to move materials intoplace, reset the assembly line, and clean the equipment. The holding cost of a refrigerator is $50 per year. The current production plan calls for 400 refrigerators to be produced in each production run. Assume there are 250 working days per year.

a) what is daily demand for this product?

b) if the company were to continue to produce 400 units each time production starts, how many days would production continue?

c) under the current policy, how many production runs per year would be required?

d) if the current policy continues, how many refrigerators would be in inventory when production stops? What would the average inventory level be?

e) if the company produces 400 refrigerators at a time, what would be the total annual setup cost and holding costs be?