Suppose you are the supplier of the Cover-up Drapery Company described in problem 13. It costs $2000 each time you change over your fabric producing machine from one type to another (1, 2, 3, or 4). Assume that your carrying cost is 30 per cent and the other data are as given in problem 13.
In problem 13

a. What lot sizes would the supplier of carpet pre fer to make for types 1, 2, 3, and 4?
b. How would you reconcile the lot sizes that the supplier would like to produce and those that the Cover-up Drapery Company would like to buy? Describe several ways in which these two differing lot sizes can be reconciled.

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Type Annual Demand (yards) tem Cost per Yard 300 250 100 200 $20 $18 $12 $ 8