A laptop manufacturer wants to compare the total cost of assembling its laptops in the United States versus Taiwan. All of the laptops will be sold in the United States. To evaluate inventory, it uses a safety factor of 2.25. The holding cost per laptop is $4.0 per week in the United States and $3.5 per week in Taiwan. The lead time with U.S. production is 2 week, whereas it is 8 weeks with production in Taiwan. In addition, it costs $2.50 to ship laptops to the United States from Taiwan. Weekly demand is 1,200 laptops, with a standard deviation of 1,000. a. What is the per unit holding cost of a laptop with U.S. production? -------------- per unit b. What is the per unit holding cost of a laptop with production in Taiwan? -------------- per unit c. A laptop requires 30 minutes of labor to assemble in the United States or in Taiwan. The total cost of labor in the United States is $44 per hour, while in Taiwan it is $12. What is the change in cost per laptop if it switches production to Taiwan? -------------- per unit
A laptop manufacturer wants to compare the total cost of assembling its laptops in the United States versus Taiwan. All of the laptops will be sold in the United States. To evaluate inventory, it uses a safety factor of 2.25. The holding cost per laptop is $4.0 per week in the United States and $3.5 per week in Taiwan. The lead time with U.S. production is 2 week, whereas it is 8 weeks with production in Taiwan. In addition, it costs $2.50 to ship laptops to the United States from Taiwan. Weekly demand is 1,200 laptops, with a standard deviation of 1,000.
a. What is the per unit holding cost of a laptop with U.S. production? -------------- per unit
b. What is the per unit holding cost of a laptop with production in Taiwan? -------------- per unit
c. A laptop requires 30 minutes of labor to assemble in the United States or in Taiwan. The total cost of labor in the United States is $44 per hour, while in Taiwan it is $12. What is the change in cost per laptop if it switches production to Taiwan? -------------- per unit
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