Author Question: A repetitive manufacturing firm is planning on level material use. The following information has ... (Read 70 times)

saliriagwu · **on:** Dec 3, 2019

Question 1

A certain product has been effectively managed in the past, according to its managers. The previous technique used the economic production quantity model, and resulted in an optimum lot size of 100. For this product, setup time is directly proportional to setup cost, and setup time is currently 40 minutes per batch. How much must setup time decline in order for the lot size to fall to 50 units? 25 units? 10 units?

Question 2

A repetitive manufacturing firm is planning on level material use. The following information has been collected. Currently, the firm operates 250 days per year.

Annual demand	22,000
Daily demand	88
Daily production	250
Desired lot size (2 hours of production)	63
Holding cost per unit per year	$50

a. What is the setup cost, based on the desired lot size?
b. What is the setup time, based on $40 per hour setup labor?

Jody Vaughn · **Reply #1 on:** Dec 3, 2019

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