Quiz01-KEY

# Quiz01-KEY - ISE 211 Engineering Economy Fall 2006 Quiz 1...

This preview shows pages 1–3. Sign up to view the full content.

ISE 211 Engineering Economy Fall 2006 – Quiz# 1 Name : __________________ ______________ Problem # 1: The total relevant cost of holding inventory in a plant for purchased materials is given, TRC = (6000/Q)(60) + 0.30(12)(Q/2)+6000(12) where Q= economic order quantity. Determine the optimum order quantity and the corresponding total relevant cost (TRC). Solution: TRC = (6000/Q)(60) + 0.30(12)(Q/2)+6000(12) Differentiating TRC with respect to Q, we get d (TRC)/dQ = -(360,000) Q -2 + 1.8 Q = (√ 360,000/1.8) = 447 TRC = (6000/447)(60) + 0.30(12)(447/2)+6000(12) = \$73,610

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
Problem # 2: A manufacturing firm has received a contract to assemble 1000 units of test equipment in the next year. The firm must decide how to organize its assembly operation. Skilled workers, at \$22.00 per hour each, could be assigned to individually assemble the test equipment. Each worker would do all the assembly steps and the task would take 2.6 hours per unit. An alternative approach would be to set up teams of four less skilled workers (at \$13.00 per hour
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### Page1 / 3

Quiz01-KEY - ISE 211 Engineering Economy Fall 2006 Quiz 1...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online