The function of an economic system is to provide for production, allocation, distribution and regeneration of resources.
The economic system has to perform the function of deciding what goods and services should be produced, how or in which manner they should be produced, how much and for whom the production should be done. The allocation of products and services refers to consumption ( for present use ) and investment ( for future use).
The four different types of economic systems are: traditional, command, market and mixed.
Any economic system must achieve the best use of its scarce resources and try to reach maximal employment and high economic growth.
a) Inventory cost = 12r + 4x
r = (D/x) = (4800/x)
c) Optimal order quantity = x = 120
Minimum Inventory Cost = C = $960
Optimal number of orders in a year = r = 40
x be the order quantity and r the number of orders placed during the year.
We will use the following variables:
x = Quantity being ordered per run
D = annual Demand for the item, over the year = 4800
O = ordering cost, regardless of the number of units in the order (fixed cost per order) = $12
H = annual cost to Hold/carry one unit = $8
r = the number of orders placed during the year
It is important to note which variables are annualized, which are per-order and which are per-unit.
Inventory cost = Ordering Cost + Holding or Carrying Cost
Ordering cost = (ordering cost per order) × (number of orders) = 12r
Holding Cost = (annual unit Holding cost × order Quantity)/2 (because throughout the year, on average the warehouse is half full).
Holding cost = (8 × x)/2 = 4x
Inventory cost = 12r + 4x
b) The constraint equation
Total demand = (order quantity per order) × (number of orders)
D = rx
r = (D/x)
r = (4800/x)
c) Inventory Cost = C = 4x + 12r = 8x + 12(4800)/x
C = 4x + 57600/x
At minimum inventory cost, (dC/dx) = 0
(dC/dx) = 4 - 57600/x² = 0
57600 = 4x²
x² = (57600/4)
x² = 14400
x = √14400
x = 120
C = 4x + 57600/x
C = 4(120) + (57600/120)
C = 480 + 480 = $960
Hope this Helps!!!
Dividing the EU into multiple markets .
Dividing the EU into multiple markets
The function of the EMU involves the coordination of economic and fiscal policies, a common monetary policy, and a common currency, the euro.
The four main functions of an economic system are,
a). Production: This is concerned with hat goods and services will be produced in the economy.
b). Allocation: This is concerned with how these goods will be produced, that is using labor intensive technology or capital incentive technology.
c). Distribution: This is concerned with whom the goods are produced, that is how the share of the economic pie will be distributed.
d). Regeneration: This function is concerned with allocating resources between consumption for present use and investment for future use.
The government function selected is protection and regulation of the enviroment.
This government function is mainly carried out by the Enviromental Protection Agency (EPA).
Over the past fifteen years, the EPA annual budget has averaged at around 8 billion dollars. In this time frame, it had its highest budget in 2010, with over 10 billion dollars.
The EPA essentially deals with market failures. Externalities like pollution or over exploitation of natural resources (tragedy of the commons) are some of the most commonly issues that the EPA has to solve.
to produce and distribute goods and services
An economic system is a working model of the production and distribution of goods and services in the economy. This can happen in many ways, but the most common economic systems are the planned economy systems, when the state controls the production and distribution of goods and services (typical in communist countries), the market economy system, when only Private firms produce and market goods and services, and the most common system is the mixed system in which both the state and firms operate in the production and marketing of goods and services. In the latter case, the state operates only in strategic sectors, such as oil (through state-owned companies) and the rest of the production of goods and services originates from private firms.
Outsourcing company has quoted a price of $5,500,000/year which is greater than total operating cost which is $5,296,000 so outsourcing is not good option.Outsourcing will be expensive.
Lets find the operational cost per year:
Rent=Area*Cost per square feet*months
Overhead cost=Labor cost*30%
Total Cost=Rent+Labor cost+Overhead cost+utilities
Outsourcing company has quoted a price of $5,500,000/year which is greater than total operating cost which is $5,296,000, so outsourcing is not good option.Outsourcing will be expensive.
oils a critical component to the functioning of Western economics.