EBK PRODUCTION AND OPERATIONS ANALYSIS
EBK PRODUCTION AND OPERATIONS ANALYSIS
7th Edition
ISBN: 9781478628385
Author: Olsen
Publisher: WAVELAND PRESS (ECONTENT)
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Chapter 3.5, Problem 26P

A)

Summary Introduction

Interpretation: formulate linear program

Concept introduction: Linear Programming (LP) is a process to accomplish the best conclusion, such as highest profit or least cost in a Mathematical Model whose necessities are signified by linear relations.

B)

Summary Introduction

Interpretation: determine the cost of the plan and optimal solution.

Concept introduction: Linear Programming (LP) is a process to accomplish the best conclusion, such as highest profit or least cost in a Mathematical Model whose necessities are signified by linear relations.

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The annual demand for water bottles at Mega Stores is 500 units, with an ordering cost of Rs. 200 per order. If the annual inventory holding cost is estimated to be 20%. of unit cost, how frequently should he replenish his stocks? Further, suppose the supplier offers him a discount on bulk ordering as given below. Can the manager reduce his costs by taking advantage of either of these discounts? Recommend the best ordering policy for the store. Order size Unit cost (Rs.) 1 – 49 pcs. 20.00 50 – 149 pcs. 19.50 150 – 299 pcs. 19.00 300 pcs. or more 18.00
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