The dealer has allocated a budget of 23,000 TL for the transportation of the machines from the factory. Assume that the annual inventory carrying cost rate is 30 percent. Calculate the unconstrained order quantities. Are these values optimal? If not, determine the optimal quantities to be stored from each model (Hint: λ is 0.337).

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...
icon
Related questions
Question
answer in 30 mins.
A dealer of white goods buys washing machines from Arçelik. In their next order, they plan to buy two models for which the related data are as follows:
Washing machine model
Annual demand (units)
6800
8500
Ordering cost (TL)
125
125
Unit purchasing cost (TL)
2400
1900
Transportation cost per unit (TL)
250
220
The dealer has allocated a budget of 23,000 TL for the transportation of the machines from the factory. Assume that the annual inventory carrying cost rate is 30 percent.
Calculate the unconstrained order quantities. Are these values optimal? If not, determine the optimal quantities to be stored from each model (Hint: 2 is 0.337).
Transcribed Image Text:A dealer of white goods buys washing machines from Arçelik. In their next order, they plan to buy two models for which the related data are as follows: Washing machine model Annual demand (units) 6800 8500 Ordering cost (TL) 125 125 Unit purchasing cost (TL) 2400 1900 Transportation cost per unit (TL) 250 220 The dealer has allocated a budget of 23,000 TL for the transportation of the machines from the factory. Assume that the annual inventory carrying cost rate is 30 percent. Calculate the unconstrained order quantities. Are these values optimal? If not, determine the optimal quantities to be stored from each model (Hint: 2 is 0.337).
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Practical Management Science
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Business in Action
Business in Action
Operations Management
ISBN:
9780135198100
Author:
BOVEE
Publisher:
PEARSON CO
Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.