Reference no: EM131463336
Question: Harold Gwynne is considering starting a sandwich-making business from his dormitory room in order to earn some extra income. However, he has only a limited budget of $100 to make his initial purchases. Harold divides his needs into three areas: breads, meats and cheeses, and condiments. He estimates that he will be able to use all the products he purchases before they spoil, so perishability is not a relevant issue. The demand and cost parameters are as follows.
Breads Meats and Cheese Condiments
Weekly Demand 6 packages 12 packages 2 pounds
Cost per unit $0.85 $3.50 $1.25
Fixed order cost $12 $8 $10
The choice of these fixed costs is based on the fact that these items are purchased at different locations in town. They include the cost of Harold's time in making the purchase. Assume that holding costs are based on an annual interest rate of 25 percent.
a. Find the optimal quantities that Harold should purchase of each type of product so that he does not exceed his budget.
b. If Harold could purchase all the items at the same location, would that alter your solution? Why?
|
Research on the economic performance of country
: Conduct research on the economic performance of one country over the last ten years, from 2005 to 2014, applying the macroeconomic indicators of real GDP
|
|
What was the additional average annual cost of holding
: The president of Value Filters became very enthusiastic about using EOQs to plan the sizes of her production runs, and instituted lot sizing based on EOQ values
|
|
Explain the role of leadership in corporate culture
: How would you explain the role of leadership in corporate culture, and how would you describe leadership styles and how they affect ethical decision-making?
|
|
Develop a graph of the average cost per unit
: Consider the carload discount schedule pictured in Figure 4-13 (page 225). Suppose M = 500 units, C = $10 per unit, and a full carload of 500 units costs $3,000
|
|
Explain the demand and cost parameters
: Harold Gwynne is considering starting a sandwich-making business from his dormitory room in order to earn some extra income. However, he has only a limited.
|
|
Discuss about a products or companys reputation
: A brand says a lot about a product's or company's reputation. Firms spend lots of time and resources developing their brand and over time brand develops equity.
|
|
Analyze various ethical issue a financial manager could face
: Analyze the various ethical issues a financial manager could potentially face and how these could be handled. Analyze Roles and Responsibilities for Compliance.
|
|
How is an organizations international sustainability effort
: Sustainability in the Global Economy- How is an organization's international sustainability effort different from its sustainability efforts in domestic market?
|
|
Explain optimal time and also find it for placement of order
: Mike's Garage, a local automotive service and repair shop, uses oil filters at a fairly steady rate of 2,400 per year. Mike estimates that the cost of his time.
|