Question: please proceed the calculations for each questions. 4. Johnson Electronics sells electronic components through catalogs. Catalogs are updated and printed every three months. Each printing
please proceed the calculations for each questions.
4. Johnson Electronics sells electronic components through catalogs. Catalogs are updated and printed every three months. Each printing run incurs a fixed cost of $2,500, which involves catalog design cost and printing setup cost. The variable production cost is $3 per catalog. Annual demand for catalogs is estimated to be normally distributed with a mean of 10,000 and a standard deviation of 2,000. Data indicate that, on average, each customer ordering a catalog generates a revenue of $15 from sales. How many catalogs should be printed in each run? 5. As an owner of Catch-of-the-Day Fish Shop, you can purchase fresh fish at $15 per crate each morning from the Walton Fish Market. During the day, you sell crates of fish to local restaurants for $60 each. Coupled with the perishable nature of your product, your integrity as a quality supplier requires you to dispose of each unsold crate at the end of the day. Your cost of disposal is $1.5 per crate. You have a problem, however, because you do not know how many crates your customers will order each day. To address this problem, you have collected several days' worth of demand data shown in the table below. Determine the optimal number of crates to purchase each morning
Step by Step Solution
There are 3 Steps involved in it
4 Number of Catalogs to Print in Each Run To determine the optimal number of catalogs to print in each run we use the Economic Order Quantity EOQ mode... View full answer
Get step-by-step solutions from verified subject matter experts
