Annual demand for a certain part 10000 units at present, Management Theories

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Annual demand for a certain part 10000 units at present

Question: Annual demand for a certain part = 10,000 units. At present, the setup time on the machine tool that makes this part = 5.0 hr. Cost of downtime on this machine = $200/hr. Annual holding cost per part = $1.50. Determine:

(a) FOG and

(b) total inventory costs for these data. Also, determine.

(d) total inventory costs if the changeover time could be reduced to 6 mm.

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Management Theories: Annual demand for a certain part 10000 units at present

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