What will be the breakdown of cost for each alternative

Assignment Help Operation Management

Reference no: EM132216610

3. Ergonomics, Inc. sells ergonomically designed office chairs. The company provided the following information:

Average Demand = 15 units per day

Average lead time = 20 days

Item unit cost = $62 for orders of less than 200 units

Item unit cost = $58 for orders of more 200 units or more

Ordering costs = $20

Inventory carrying costs = 30%

The business year is 250 days

Based on the above information: How many chairs should the firm order each time?

What will the firm’s average inventory be under each alternative?

What will be the breakdown of cost for each alternative?

Assume there is no uncertainty at all about demand or the lead time.

Reference no: EM132216610

Questions Cloud

Stimulate creativity and innovation in their businesses : How are corporations using Innovation Labs to stimulate creativity and innovation in their businesses?

The company was model of learning organization : Enron, the company was a model of a learning organization when it exploded onto the business stage.

Determining appropriate organisational structure : What contingencies should an organisation take into account when determining an appropriate organisational structure?

Can rational and non rational models be integrated to create : Can rational and non rational models be integrated to create/produce better decisions?

What will be the breakdown of cost for each alternative : What will the firm’s average inventory be under each alternative? What will be the breakdown of cost for each alternative?

Average weekly profit rounded to nearest whole dollar : Assume each car loses $40 in value per week due to depreciation. What is the average weekly profit rounded to the nearest whole dollar?

High performance work practice : Which of the following is NOT a high performance work practice? Cost reductions that flow from operating in multiple businesses is referred to as a(n).

What are freight classifications and how are they determined : It is often argued that local knowledge spillover is more feasible for firms existing in cluster. What are freight classifications and how are they determined?

Readings-lectures and specific elements from the news : What connections can you draw between this week’s readings/lectures and the specific elements from the news?

User Account

All Pages