Answer:
a) Optimal Run Size OR EPR=5473.15≅5473
b) Number of runs per year=19.73≅20 runs
c) Length in days of a run=0.9518 per day≅1 per day
Step-by-step explanation:
Holding Cost=H=$0.5
Setup Cost=S=$65
Production per day=p=5750 hot dogs
Demand per day=d=360 hot dogs
Annual Demand= D= Demand per day x Operational days
Annual Demand= D=360 x 300=108000
Optimal Run Size OR EPR=[tex]\sqrt{\frac{2*D*S}{H*(1-\frac{d}{p}) } }[/tex]
Optimal Run Size OR EPR=[tex]\sqrt{\frac{2*108000*65}{0.5*(1-\frac{360}{5750}) } }[/tex]
Optimal Run Size OR EPR=5473.15≅5473
Number of runs er year=Annual Demand/ Optimal Run Size
Number of runs er year=108000/5473
Number of runs per year=19.73≅20 runs
Length in days of a run= optimal Run Size/ Daily Demand
Length in days of a run=5473/5750
Length in days of a run=0.9518 per day≅1 per day
