A chemical company produces chemicals for lawn fertilizer. The annual demand for this product, which is produced with a daily production rate of 10000 tons, is 0.6*106 tons. The preparation cost required to carry out the production is 1500 TL and the variable production cost per ton is 3.5 TL. Considering that an annual interest rate of 34% is used and 250 days a year are worked a. What is the optimum amount that should be produced from this chemical? b. How much of a cycle time was produced?

A chemical company produces chemicals for lawn fertilizer. The annual demand for this product, which is produced with a daily production rate of 10000 tons, is 0.6*106 tons. The preparation cost required to carry out the production is 1500 TL and the variable production cost per ton is 3.5 TL. Considering that an annual interest rate of 34% is used and 250 days a year are worked a. What is the optimum amount that should be produced from this chemical? b. How much of a cycle time was produced?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section14.A: Breakeven Analysis

Problem 4P

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