Answer to Question #90475 in Economics for Sukhchain Singh

Question

The demand for an item is 25,000 per year. Production
rate is 2500 units month. The carrying cost is Rs.0.20/
unit per month and the setup cost is Rs 400 per setup.
The storage cost is Rs.25 per unit per year. Find the
following parameters

(i)Economic batch quantity
(ii)Maximum Inventory
(iii)Maximum stock out
(iv)Cycle time

Answer 1

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