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Lenovo uses 450,000 hard disks per year to mount in their laptops. The manufacturer receives the hard disks from a supplier at a rate of 1800 per day. Carrying cost per hard disk is $2/year and setup cost for a production run is $450. The plant operates 250 days per year.

1- Compute the economics production quantity. Equation is EPQ= SQUT((2*D*S)/H(1-d/p))

2- Compute the maximum inventory. Equation is Imax= Q*(1-d/p).

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92578708

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