8. The Surgery Unit of Piedmont has determined that the annual demand for surgical gloves is 25,000 pairs. It costs $16 every time an order is placed, and with their limited storage space it is estimated that it costs $0.05 to hold one pair of gloves in inventory for a year. Also, assuming 250 working days per year, it takes 10 days for an order to arrive. Assume no safety stock is needed. Setup this EOQ problem and answer the following questions. 8a) What should their ORDER SIZE be if they want to minimize total cost using EOQ? 8b) What is the computed REORDER POINT for surgical gloves? 9. Piedmont Hospital decides to go into the glove manufacturing business for themselves, considering their annual demand for surgical gloves is 25,000 pairs. It costs $25 to set up their production equipment and personnel, and 500 pairs can be produced each day. With their limited storage space it is estimated that it costs $0.05 to hold one pair of gloves in inventory for a year. Assuming 250 working days per year, perform a Production Order Quantity analysis and answer the following questions: 9a) What should their ORDER SIZE be if they want to minimize total cost with POQ? 9b) For how many consecutive days will they produce surgical gloves for a given cycle? 9c) Comparing the results of the POQ here to the EOQ in the prior problem, which is the less expensive option for Piedmont Hospital? (choose one of the following) (A) Ordering gloves (B) Producing gloves (C) They are equal in cost 10. In purchasing the Ops Mgt textbook from the publisher, the JU Bookstore was offered the following pricing schedule. QUANTITY PRICE $20 $18 $17 The annual demand is expected to be 200 books. The ordering cost is $20 and the annual holding cost is $3 per book. 1 - 49 50-99 100+
8. The Surgery Unit of Piedmont has determined that the annual demand for surgical gloves is 25,000 pairs. It costs $16 every time an order is placed, and with their limited storage space it is estimated that it costs $0.05 to hold one pair of gloves in inventory for a year. Also, assuming 250 working days per year, it takes 10 days for an order to arrive. Assume no safety stock is needed. Setup this EOQ problem and answer the following questions. 8a) What should their ORDER SIZE be if they want to minimize total cost using EOQ? 8b) What is the computed REORDER POINT for surgical gloves? 9. Piedmont Hospital decides to go into the glove manufacturing business for themselves, considering their annual demand for surgical gloves is 25,000 pairs. It costs $25 to set up their production equipment and personnel, and 500 pairs can be produced each day. With their limited storage space it is estimated that it costs $0.05 to hold one pair of gloves in inventory for a year. Assuming 250 working days per year, perform a Production Order Quantity analysis and answer the following questions: 9a) What should their ORDER SIZE be if they want to minimize total cost with POQ? 9b) For how many consecutive days will they produce surgical gloves for a given cycle? 9c) Comparing the results of the POQ here to the EOQ in the prior problem, which is the less expensive option for Piedmont Hospital? (choose one of the following) (A) Ordering gloves (B) Producing gloves (C) They are equal in cost 10. In purchasing the Ops Mgt textbook from the publisher, the JU Bookstore was offered the following pricing schedule. QUANTITY PRICE $20 $18 $17 The annual demand is expected to be 200 books. The ordering cost is $20 and the annual holding cost is $3 per book. 1 - 49 50-99 100+
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Question 8-9 questions in red
Transcribed Image Text:8. The Surgery Unit of Piedmont has determined that the annual demand for surgical gloves is 25,000 pairs. It costs
$16 every time an order is placed, and with their limited storage space it is estimated that it costs $0.05 to hold one
pair of gloves in inventory for a year. Also, assuming 250 working days per year, it takes 10 days for an order to
arrive. Assume no safety stock is needed. Setup this EOQ problem and answer the following questions.
8a) What should their ORDER SIZE be if they want to minimize total cost using EOQ?
8b) What is the computed REORDER POINT for surgical gloves?
9. Piedmont Hospital decides to go into the glove manufacturing business for themselves, considering their annual
demand for surgical gloves is 25,000 pairs. It costs $25 to set up their production equipment and personnel, and 500
pairs can be produced each day. With their limited storage space it is estimated that it costs $0.05 to hold one pair of
gloves in inventory for a year. Assuming 250 working days per year, perform a Production Order Quantity analysis
and answer the following questions:
9a) What should their ORDER SIZE be if they want to minimize total cost with POQ?
9b) For how many consecutive days will they produce surgical gloves for a given cycle?
9c) Comparing the results of the POQ here to the EOQ in the prior problem, which is the less expensive option
for Piedmont Hospital? (choose one of the following)
(A) Ordering gloves
(B) Producing gloves
(C) They are equal in cost
10. In purchasing the Ops Mgt textbook from the publisher, the JU Bookstore was offered the following pricing schedule.
QUANTITY
PRICE
$20
1 - 49
50-99
100+
$18
$17
The annual demand is expected to be 200 books. The ordering cost is $20 and the annual holding cost is $3 per book.
PII
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