A chemical firm produces sodium bisulfate in 100-pound bags. Demand for this product is 20 tonsper day. The capacity for producing the product is 50 tons per day. Setup costs $100, and storage andhandling costs are $5 per ton a year. The firm operates 200 days a year. (Note: 1 ton = 2,000 pounds.)a. How many bags per run are optimal?b. What would the average inventory be for this lot size?c. Determine the approximate length of a production run, in days.d. About how many runs per year would there be?e. How much could the company save annually if the setup cost could be reduced to $25 per run?

A chemical firm produces sodium bisulfate in 100-pound bags. Demand for this product is 20 tonsper day. The capacity for producing the product is 50 tons per day. Setup costs $100, and storage andhandling costs are $5 per ton a year. The firm operates 200 days a year. (Note: 1 ton = 2,000 pounds.)a. How many bags per run are optimal?b. What would the average inventory be for this lot size?c. Determine the approximate length of a production run, in days.d. About how many runs per year would there be?e. How much could the company save annually if the setup cost could be reduced to $25 per run?

Precision Machining Technology (MindTap Course List)

2nd Edition

ISBN:9781285444543

Author:Peter J. Hoffman, Eric S. Hopewell, Brian Janes

Publisher:Peter J. Hoffman, Eric S. Hopewell, Brian Janes

Chapter1: Introduction To Machining

Section1.3: Workplace Skills

Problem 13RQ: Briefly describe a portfolio and give an example of what it might contain.

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