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Water Wheelies manufactures high-pressure sprinkler heads. These are produced periodically at a rate of 960 per day. Demand is steady at 720 per day. Assume 250 days per year. Each production run has a set-up cost of $120. Water Wheelies uses an annual inventory holding cost of $2.4 for carrying one unit for one year. a. (1 point) Determine the optimal production quantity during each production run. b. (2 points) Determine the annual holding cost, set-up cost and total cost. c. (1 point) Determine the maximum inventory. d. (3 points) Determine the cycle time between two production runs in days. In each cycle compute the number of days the production facility is busy (uptime) and the number of days the production facility is idle (downtime). e. (3 points) Water Wheelies can double its production rate by using a new technology, but the setup cost per production run will also double. Determine the economic production quantity and the annual holding and set-up costs.
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