Maha industries produces a product whose anticipated demand for the six periods is 263, 256, 301, 312, 304, and 294. If the firm has adopted level production strategy with a constant production of 280 units per period. The regular production cost is RO 12 per unit, whereas the overtime and subcontract costs are RO 20 and RO 25 per unit respectively. There is no limit on subcontracting; however, maximum overtime production capacity is 10. Average inventory holding cost is RO 5 per unit per period. What will be inventory level at the end of period 3? O a. None is correct O b. 0 Ос. 20 O d. 41 O e. 17

Maha industries produces a product whose anticipated demand for the six periods is 263, 256, 301, 312, 304, and 294. If the firm has adopted level production strategy with a constant production of 280 units per period. The regular production cost is RO 12 per unit, whereas the overtime and subcontract costs are RO 20 and RO 25 per unit respectively. There is no limit on subcontracting; however, maximum overtime production capacity is 10. Average inventory holding cost is RO 5 per unit per period. What will be inventory level at the end of period 3? O a. None is correct O b. 0 Ос. 20 O d. 41 O e. 17

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter8: Cost Analysis

Section: Chapter Questions

Problem 9E

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