Question

Bold vision, inc, makes laser printer and pholocopier lonet caltidges. the demand rate is 690 ep cartridges per week. the production rate is 1,673 ep cartridges per week, and the setup cost is $100 . the value of imentory is $130 per unt, and the holding cost is 30 percemt of the inventory value. boid vision operates 52 weeks per year. what is the oconomic production lot size? the economie production lot sice is cartridges. (enter your response rounded to the nearest whole number)

Answer 1

The economic production lot size for Bold Vision, Inc. is 226 cartridges.

Step-by-step explanation:

To calculate the economic production lot size, we can use the Economic Order Quantity formula. The formula is EOQ = sqrt((2*D*S)/H), where D is the demand rate, S is the setup cost, and H is the holding cost. In this case, D = 690 cartridges/week, S = $100, and H = 30% of the inventory value. We need to convert the holding cost to a dollar value, so 30% of $130 = $39. The economic production lot size (EOQ) is then calculated as:

EOQ = sqrt((2 * 690 * 100) / 39) = 226.22 cartridges.

Rounding to the nearest whole number, the economic production lot size is 226 cartridges.