QUESTION $4$

$(20$ Marks$)$

$4\mathrm{.}1$ Use the information provided below to answer the following question.

INFORMATION:

SOS Group of Hospitals $($SOSGH$)$ dispenses $360000$ packets of a specific medicine to patients annually. SOSGH procures the medicine in six equal instalments from the supplier, at a cost of R$500$ per packet. The cost per order is R$2500.$ Upon receiving the medicine from the supplier, SOSGH incurs additional expenses to hold and maintain it in the hospital pharmacy. The holding cost per packet per year amounts to $10\%$ of the unit purchase price.

REQUIRED:

$4\mathrm{.}1\mathrm{.}1$ Compute the economic order quantity $($EOQ$)$ of the packets of medicine.

$(3$ Marks$)$

$4\mathrm{.}1\mathrm{.}2$ Based on the ordering policy stated above, compute the total annual ordering and holding costs of the

$(3$ Marks$)$

medicine.

$4\mathrm{.}1\mathrm{.}3$ How much money can SOSGH save by replacing the existing inventory policy with the economic order

$(5$ Marks$)$

quantity $($EOQ$)$ model?

$4\mathrm{.}2$ Use the information provided below to answer the following question.

INFORMATION:

A West African nation has established a Scientific, Medical, and Industrial Research Centre $($SMIRC$)$ to spearhead the national research agenda. The SMIRC employs three categories of researchers $-$ Grade I, Grade II$,$ and Grade III. Remuneration at the SMIRC operates on a piecework system, with rates set at R$20000,$ R$17000,$ and R$15000$ per standard hour for Grade I, Grade II$,$ and Grade III researchers, respectively. The standard time allowed per unit of research output across the board is four hours per $40-$hour working week. The table below displays the number of units of research output produced by the $95$ researchers at the SMIRC during a particular $40-$hour working week:

$\backslash$table$[[$Category of researchers,Number of researchers per the following units of output:$],[6$ units,$8$ units,$10$ units,$12$ units,$14$ units$],[$Grade I,$3,5,9,6,2],[$Grade II$,2,7,10,8,3],[$Grade III,$1,9,19,10,1]]$

REQUIRED:

Calculate the average gross remuneration of each category of researchers for the week $($show all calculations$).$

$(9$ Marks$)$