A supplier to Ford stamps out parts using a press. Changing a part type requires the supplier to change the die on the press. This changeover currently takes four hours. The supplier estimates that each hour spent on the changeover costs $250. Demand for parts is 1,000 per month. Each part costs the supplier $100, and the supplier incurs an annual holding cost of 25%.
Required:
A) Determine the optimal production batch size for the supplier.

The optimal production batch size for the supplier is 980 units.

Explanation:

In order to calcuate the optimal production batch size for the supplier we have to use the following formula:

optimal production batch size= (2×Annual Demand×setup cost)

                                                                 Holding Cost

optimal production batch size= (2×(1,000×12)×($250×4)

                                                                  ($100×25%)

optimal production batch size=(2×12,000×$1,000)

                                                               $25

optimal production batch size= 980 units

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- poor people tend to gain less access to good education and nutrition. this mean that their chance to obtain high paying jobs would also be limited.

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- rich people tend to have more capital in their disposal. this would benefit them in business since it is far easier for them to fund their business operation compared to poor people.