Question: The information here is the same for answering questions 46 to 50 . A company has purchased one component from its supplier for years. Since

The information here is the same for answering

The information here is the same for answering questions 46 to 50 . A company has purchased one component from its supplier for years. Since the production process of this component is quite simple and involves no capital investment, the Operations Manager proposes to make this component in house so that the component may flow gradually into the assembly line for use. The following data are also given for your comparison and decision making: *Operates 50 weeks a year Q46 Suppose the company decides to continue to buy from the supplier. In which of the following scenarios will EOQ decrease? a. The fixed cost increases from $45 to $72 b. The inventory cost increases from $2.7 to $3.0 c. The cost per unit increases from $9 to $10 d. The annual demand increases from 30,000 units to 60,000 units Q47 If the company decides to continue to buy from the supplier, which of the following is not true? a. If the annual demand and the inventory cost increase by a factor of 2, EOQ remains the same b. If the fixed cost increases by a factor of 4,EOQ will increase by a factor of 2 c. If the fixed cost increases by a factor of 4 , the total annual cost will increase by a factor of 2 d. If the annual demand and the inventory cost increases by a factor of 2 , the total annual cost remains the same

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!