Question: Problem 12.17 Question Help M. Cotteleer Electronics supplies microcomputer circuitry to a company that incorporates microprocessors into refrigerators and other home appliances. One of the

Problem 12.17 Question Help M. Cotteleer

Problem 12.17 Question Help M. Cotteleer Electronics supplies microcomputer circuitry to a company that incorporates microprocessors into refrigerators and other home appliances. One of the components has an annual demand of 245 units, and this is constant throughout the year. Carrying cost is estimated to be $0.75 per unit per year, and the ordering (setup) cost is $21 per order. a) To minimize cost, how many units should be ordered each time an order is placed? 117.13 units (round your response to two decimal places). b) How many orders per year are needed with the optimal policy? 2.09 orders (round your response to two decimal places). c) What is the average inventory if costs are minimized? 58.56 units (round your response to two decimal places). (round d) Suppose that the ordering (setup) cost is not $21, and Cotteleer has been ordering 175 units each time an order is placed. For this order policy (of Q = 175) to be optimal, the ordering (setup) cost would have to be $ your response to two decimal places)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!