Race One Motors is the Indonesian car manufacturer. At its biggest manufacturing facility, in Jakarta, the company manufactures subcomponents at the rate of 300 per day, and it employs such subcomponents at the rate of 12,500 per year (of 250 working days). Holding costs are $2 per item for each year, and ordering costs are $30 per order.
a) What is economic production quantity?
b) How many production runs per year will be made?
c) What will be maximum inventory level?
d) What percentage of time will facility are producing components?
e) What is annual cost of holding and ordering inventory?