D1 :100 D2 :50 D3 :90 D4 :60 D5 :80 D6 :70 A :75 X :5 A

 
 

D1 :100

D2 :50

D3 :90

D4 :60

D5 :80

D6 :70

A :75

X :5

Transcribed Image Text:

A company plans to implement Least Unit Cost heuristic to determine the lot sizing policy for a specific raw material, namely RM13579, for the next six months. The forecasted demand for the next six months is represented by D1, D2, D3, D4, D5 and D6, respectively where D1 # D2 #D3 #D4 #D5 D6. The order cost equals $A. Starting from month 1, if they cover the demand of the first three months, the average cost per unit, that is, K'(3) equals $X. A company plans to implement Least Unit Cost heuristic to determine the lot sizing policy for a specific raw material, namely RM13579, for the next six months. The forecasted demand for the next six months is represented by D1, D2, D3, D4, D5 and D6, respectively where D1 # D2 #D3 #D4 #D5 D6. The order cost equals $A. Starting from month 1, if they cover the demand of the first three months, the average cost per unit, that is, K'(3) equals $X.

Answer rating: 100% (QA)

a To compute the unit inventory holding cost per month h we can use the formula XK3 Given that X5 an... View the full answer