Question: I am looking for help on Part D and E 1. Consider a manufacturer who orders a particular part to supply a production process. Assume

I am looking for help on Part D and E 1. ConsiderI am looking for help on Part D and E

1. Consider a manufacturer who orders a particular part to supply a production process. Assume that the cost and demand characteristics for the ordered part satisfy the assumptions of the EOQ. Specifically, suppose that demand occurs at a constant rate of 10 units per day during the 200 workdays in which the manufacturing plant operates annually. The unit cost of purchased parts is $5/unit, and the annual holding cost is estimated to be 30% of the unit cost. Assuming that it costs $30 to place an order, determine: a. EOQ for the part; b. Annual holding cost, annual order cost and total relevant cost and total annual cost associated with this order quantity. c. Now, consider the situation where the supplier of the ordered part uses a standard sized pallet for shipment. Specifically, assume that the supplier ships parts in pallets of 64 units. What would be the new order quantity? What are the total relevant costs associated with this order quantity? d. Consider the same situation as described in question 1 (with no pallet size) with the exception that the supplier requires a 35-day period to deliver the order. In this case: i. What would be the optimal order quantity? ii. What are the total relevant costs associated with the optimal order quantity? iii. Does the modified order quantity result in higher ordering costs, higher holding costs, or both and why? iv. What would be the optimal time between consecutive orders? v. What would be the inventory level at which new orders should be placed (ROL)? e. What would be the ROL if the supplier were able to reduce the lead time to 15 days. Did a longer lead time (35 days vs. 15 days) result in a larger ROL

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