A manufacturer produces four products on one machine. No other products are assigned to this equipment. The data for the item are given in the following table. r is 0.24 $/$/year.

Item 1 2 3 4 Di (units/year) 2,000 500 8,000 5,000 vi ($/unit) 30 50 20 120 pi (units/year) 50,000 2,000 20,000 24,000 Ai ($) 75 120 110 60 Ki (hours) 5 6 8 4 vi ($/unit) 15 16 7.80 12.25

a. From the results of Section 10.6.1, find the optimal order interval and quantities, assuming each product is produced each cycle.

b. Briefly comment on your answer for a real environment.

c. What is the ratio of the cost of this pure rotation schedule to the optimal? P-96