Best Buy sells three models of computers, the Litepro, Medpro, and Heavypro, and they are managed by three independent product managers. Annual demands for the three products are as follows: DL = 120,00 units for the litepro, DM = 1,200 units for the Medpro, and DH = 120 units for the Heavy pro. Assume that each model costs Best Buy $500. A fixed transportation cost of $4,000 is incurred each time an order is delivered. For each model ordered and delivered on the same truck, an additional fixed cost of $1,000 is incurred for receiving and storage. Best Buy incurs a holding cost of $100 per year. Evaluate the lot sizes that each Best Buy manager should order if lots for each product are ordered and delivered independently. Also evaluate the annual cost of such a policy. (Use the EOQ formula.)
Best Buy sells three models of computers, the Litepro, Medpro, and Heavypro, and they are managed by three independent product managers. Annual demands for the three products are as follows: DL = 120,00 units for the litepro, DM = 1,200 units for the Medpro, and DH = 120 units for the Heavy pro. Assume that each model costs Best Buy $500. A fixed transportation cost of $4,000 is incurred each time an order is delivered. For each model ordered and delivered on the same truck, an additional fixed cost of $1,000 is incurred for receiving and storage. Best Buy incurs a holding cost of $100 per year. Evaluate the lot sizes that each Best Buy manager should order if lots for each product are ordered and delivered independently. Also evaluate the annual cost of such a policy. (Use the EOQ formula.)
Elements Of Electromagnetics
7th Edition
ISBN:9780190698614
Author:Sadiku, Matthew N. O.
Publisher:Sadiku, Matthew N. O.
ChapterMA: Math Assessment
Section: Chapter Questions
Problem 1.1MA
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Best Buy sells three models of computers, the Litepro, Medpro, and Heavypro, and they are managed
by three independent product managers. Annual demands for the three products are as follows: DL =
120,00 units for the litepro, DM = 1,200 units for the Medpro, and DH = 120 units for the Heavy pro.
Assume that each model costs Best Buy $500. A fixed transportation cost of $4,000 is incurred each
time an order is delivered. For each model ordered and delivered on the same truck, an additional fixed
cost of $1,000 is incurred for receiving and storage. Best Buy incurs a holding cost of $100 per year.
Evaluate the lot sizes that each Best Buy manager should order if lots for each product are ordered and
delivered independently. Also evaluate the annual cost of such a policy. (Use the EOQ formula.)
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