What will the optimal duration of the downtime in years ? a.None is correct b. 0.076 c. 0.069 d. 0.721 e. 0.065 O f. 0.502

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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4. Nestle Ltd. It produces its premium plant food in 50 Kg bags. Demand is 100,000 Kgs. per week and the plant operates 52 weeks each year. Nestle can produce 250,000 Kgs. per week. The setup cost is OMR 200 and the annual holding cost rate is OMR 0.40 per bag. What will the optimal duration of the downtime in years ? a.None is correct b. 0.076 c. 0.069 d. 0.721 e. 0.065 O f. 0.502
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