Question: A component used in a manufacturing facility is ordered from an outside supplier. The estimated demand over the next 10 weeks is Week 1 2
A component used in a manufacturing facility is ordered from an outside supplier. The estimated demand over the next 10 weeks is
| Week | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 |
| Demand | 22 | 34 | 32 | 12 | 8 | 44 | 54 | 16 | 76 | 30 |
The holding cost is $3.25 per unit per week. The fixed order cost is estimated to be $200.
Compare the holding and setup costs obtained over the six periods using the Silver-Meal heuristic with the cost of a Lot-for-Lot policy.
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