Homework #$2$

Name:

Show your work$/$steps and specify the units $($ $$,\%,$ days, etc.$)$ for your answers to recenven..........

$(1)$ An architecture firm consumes an average of $160$ boxes of copier paper per day and operates for $280$

days each year. The annual storage and handling cost for each box is $$30,$ while the cost to place and

receive an order is $$60.$

$($a$)$ What order quantity would minimize the total annual inventory cost? $($rounding to $1$ decimal place$)$

$($c$)$ The office manager currently orders $300$ boxes at a time. Should the manager continue with this

order size? Justify based on the total annual inventory cost. $($rounding to the nearest dollar$)$

$(2)$ The ABC Company is both a producer and a user of brass couplings. The firm operates $280$ days a year

and uses the couplings at a steady rate of $60$ per day. Coupling can be produced at a rate of $200$ per day.

Annual storage cost is $$2$ per coupling, while setup cost is $$120$ per run. Determine the:

$($a$)$ optimal production run size $=$

$($b$)$ duration of the inventory cycle $=$

$($c$)$ maximum inventory level $=$

$(3)$ Suppose a perishable item costs $$10$ and sells for $$19.$ Any item that isn't sold by the end of the day can

all be sold at $$8.($a$)$ Find $MP=$

and $ML=$

$($b$)$ Complete the last column of the table, which reveals the demand for this item.