PA machine shop manufactures custom brake disks for high performance cars. The shop needs to meet a demand of 1200 units per year. For each production run there is a setup cost of 1200 dollars, and there is a cost of 90 dollars per unit for materials and supplies. Storage of unsold units costs the shop 18 dollars per year. How many units should the shop produce on each production run in order to minimize inventory costs (setup plus storage)? Round your answer to the nearest integer.

PA machine shop manufactures custom brake disks for high performance cars. The shop needs to meet a demand of 1200 units per year. For each production run there is a setup cost of 1200 dollars, and there is a cost of 90 dollars per unit for materials and supplies. Storage of unsold units costs the shop 18 dollars per year. How many units should the shop produce on each production run in order to minimize inventory costs (setup plus storage)? Round your answer to the nearest integer.

Name: PA machine shop manufactures custom brake disks for high performance
Uploaded: 2024-03-20T06:57:05.000Z
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Description: PA machine shop manufactures custom brake disks for high performance cars. The shop needs to meet a demand of 1200 units per year. For eachproduction run there is a setup cost of 1200 dollars, and there is a cost of 90 dollars per unit for materials

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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