Solution-Find the production quantity that minimizes cost

Find the production quantity that minimizes cost

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Reference no: EM132690599

Mohawk Manufacturing requires 10,000 castings a year for use in assembling lawn and garden tractors. The foundry can produce 30,000 castings a year. The cost associated with setting up the production line is $25, and the carrying cost per unit is $2 annually. Lead time is 60 days.

Question a. Find the production quantity that minimizes cost.

Question b. Calculate the total annual cost of setting up for and carrying inventory, based on the answer to part (a) for a year.

Reference no: EM132690599

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Find the production quantity that minimizes cost

Reference no: EM132690599

Reference no: EM132690599

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