IUBAT- International University of Business Agriculture and Technology

Assignment: 02

Subject name: Production-Operations Management

Course code: POP 301

Section: B

Submitted to

Md. Sadman Sakib

Faculty, College of Business Administration

Submitted by

Md.Mahmudul Hasan

ID-13102362

Program-BBA
 Problem-01

Solution:
Here, annual Demand ,D=9600 tires per year
Holding Cost, H=$ 16 per unit per year
Ordering Cost, S==$ 75

2 DS
i) Economic order Quantity ,Q=
√ H
2 × 9600× 75
=
√ 16
14,40,000
=
√ 16
¿ √ 90000
=300 tires/year

D ( ANNUAL DEMAND)
ii)Numbers of Order per year =
Q(ORDERING QUANTITY )

9600 tires/ year

= = 32 times
300 tires /order

Q(ordering quantity)
iii)Length of an order Cycle=
D(annual demand)
300 tires /order
=
9600 tires/ year
=0.03125 of a year,
Since there are 288 days in the year the order cycle= 0.03125 ×288 = 9 workdays (Ans.)

iv)Total Cost, TC =carrying cost +ordering cost

Q D
( )
= × H +( × S)
2 Q
300 9600
=( 2 )
× 16 +(
300
×75)
=$2400+$2400
=$4800
(ans)

Problem-2
Solution
Here, annual Demand ,D=3600 cathode ray tubes per year
Holding Cost, H=.20 ×65=$ 13
Ordering Cost, S==$ 31

2 DS
I) Economic order Quantity ,Q=
√ H
 2 ×3600 ×31
=
√223200
13
=
√ 13
¿ √ 17169
≈ 131 cathode ray tubes

D( ANNUA L DEMAND)
ii)Numbers of Order per year =
Q(ORDERING QUANTITY )

3600
= = 27.480 times
131

Q(ordering quantity)
iii)Length of an order Cycle=
D(annual demand)
131
=
3600
=0.0363 of a year,
Since there are 288 days in the year the order cycle= 0.0363 ×288 = 10workdays (Ans.)

iv)Total Cost, TC =carrying cost +ordering cost

Q D
( )
= × H +( × S)
2 Q
131 3600
= (
2
×13 +( )
131
× 31)
=$851+$851
=$1702

Problem-3

Here, Annual Demand ,D=48000 wheels per year

Holding Cost, H=1 per wheel
Ordering Cost, S=$45
Production rate, P=800 wheels per day
Usage rate, U =4800 wheels Per 240 days or 200 wheels per day
2 DS p
I) Optimal Run size ,Q p=
H √ √
p−u

2 × 48000 ×45 800

=
√ 1
¿2,400 wheels
√ 800−200

U 200
ii) I max= Q p (1− )=2400(1- )
P 800
=1800
 I MAX D
Holding Cost= ×H Set up Cost= × s = 48000 × 45 =$900
2 QP 2400

1800
= ×1
2
=$900

Total Cost= Holding cost + Set up cost

=$900+$900
=$1800

QP QP
iii)Cycle time = iv) Run time =
u p
2400 2400
= 200 = 800
=12 days. =3 days .Each run will require three days to compete.

Run of wheels will be made every 12 days.

v) Length of pure consumption portion= (Length of cycle –Length of run)

=12−¿3
=9 days

VI) Cycle of EPQ:

Problem-04
Solution:
Here,
Annual Demand, D= (usage rate ×operating days)=50×220=11000
Holding Cost, H=$2 per coupling
Production rate, P=200 per day
Usage rate, U=50 per day
Setup cost, S=$ 70 Per run
 2 DS p
I) Optimal Run size ,Q p=
H √ √ p−u

2 ×11000 × 70 200
√
=
2 √ 200−50

=1013 couplings

QP Q P 1013
II)Cycle time for optimal run size = iii)Run time : =
u P 200
1013
= 50 = 5days. Each run will require three days to compete
=20 days.

IV) Length of pure consumption portion =(Length of cycle – Length of run)

=20−¿5
=15 days

V)
U −5 0
I max= Q p (1− )=1013(1 )
P 2 00
=760
I MAX D
Holding Cost= ×H Set up Cost= × s = 11000 × 70 =$760
2 QP 1013

760
= ×2
2
=$760

Total Cost= Holding cost + Set up cost

=$760+$760
=$1520

VI) Cycle of EPQ: