Suppose 100,000 lamps are to be manufactured annually. It costs $1 to store a lamp for 1 year, $500 to set up the factory to produce a batch of lamps and $5 to produce each lamp. A. If all lamps are produced in one batch find the total cost? B. If all lamps are produced in two batches of equal size, find the total cost? C. If the number of units in each batch is q, then how many batches are there? D. Find the number of lamps in each batch to minmize the total cost? E. What is the minimum cost?
Suppose 100,000 lamps are to be manufactured annually. It costs $1 to store a lamp for 1 year, $500 to set up the factory to produce a batch of lamps and $5 to produce each lamp. A. If all lamps are produced in one batch find the total cost? B. If all lamps are produced in two batches of equal size, find the total cost? C. If the number of units in each batch is q, then how many batches are there? D. Find the number of lamps in each batch to minmize the total cost? E. What is the minimum cost?
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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Suppose 100,000 lamps are to be manufactured annually. It costs $1 to store a lamp for 1 year, $500 to set up the factory to produce a batch of lamps and $5 to produce each lamp.
A. If all lamps are produced in one batch find the total cost?
B. If all lamps are produced in two batches of equal size, find the total cost?
C. If the number of units in each batch is q, then how many batches are there?
D. Find the number of lamps in each batch to minmize the total cost?
E. What is the minimum cost?
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Step 1: Conceptual Introduction
VIEWStep 2: Total Cost Calculation for Producing All Lamps in One Batch (Scenario A)
VIEWStep 3: Total Cost Calculation for Producing Lamps in Two Batches (Scenario B)
VIEWStep 4: Finding the Number of Batches (Scenario C)
VIEWStep 5: Finding the Number of Lamps in Each Batch (Scenario D)
VIEWStep 6: Determining the Minimum Cost (Scenario E)
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