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Session (2011-12)

B.Tech. IV Year/VII Semester Branch: - Mechanical Engineering Prepared by: - Mr. Deepak Agrawal Assignment No. 01 (Unit-IV)

Derive classical inventory control EOQ formula when lead time is zero and shortages are not allowed. Write a short note on multi item inventory model. Write a short note on the inventory cost and their components. A producer has to supply 12,000 units of a product per year to his customer. The demand is fixed and known and backlogs are not allowed. The inventory holding cost is Rs. 0.20 per unit per month and the set up cost per run is Rs. 350/- per run. Determine (a) the optimal lot size, (b) Optimum scheduling period, (c) Minimum total expected yearly cost. 5. A stockiest has to supply 400 units of a product every Monday to his customers. He gets the product at Rs. 50/- per unit from the manufacturer. The cost of ordering and transportation from the manufacturer is Rs. 75 per order. The cost of carrying inventory is 7.5% per year of the cost of the product. Find (i) Economic lot size, (ii) The total optimal cost (including the capital cost). 6. A company has a demand of 12,000 units per year for an item and it can produce 2000 items per month. The cost of one setup is Rs. 400/- and the holding cost per unit per month is Rs. 0.15. Find the optimum lot size and the total cost per year, assuming the cost of one unit as Rs. 4/-. Also find the maximum inventory, manufacturing time and total time. 7. Find the optimal order quantity for a product for which the price breaks are as follows: Quantity Unit cost (Rs.) 0 < q < 500 Rs. 10 500 q < 750 Rs. 9.25 750 q Rs. 8.75 The monthly demand for the product is 200 units, storage cost is 2% of the unit cost and cost of ordering is Rs. 100. 8. A company has a demand of 12,000 units per year for an item and it can produce 2000 items per month. The cost of one setup is Rs. 400/- and the holding cost per unit per month is Rs. 0.15. Find the optimum lot size and the total cost per year, assuming the cost of one unit as Rs.4/-. Also find the maximum inventory, manufacturing time and total time. 9. The demand for an item is uniform at the rate of 25 units per month. The set up cost is Rs. 15/- per run. The production cost is Re.1/- per item and the inventory-carrying cost is Rs. 0. 30 per item per month. If the shortage cost is Rs. 1.50 per item per month, determine how often to make a production run and what size it should be? 10. For an item the production is instantaneous. The storage cost of one item is Re.1/- per month and the set up cost is Rs. 25/- per run. If the demand for the item is 200 units per month, find the optimal size of the batch and the best time for the replenishment of inventory.

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