The Friendly Sausage Factory (FSF) can produce hot dogs at a rate of 6,000 per d
ID: 351661 • Letter: T
Question
The Friendly Sausage Factory (FSF) can produce hot dogs at a rate of 6,000 per day. FSF supplies hot dogs to local restaurants at a steady rate of 370 per day. The cost to prepare the equipment for producing hot dogs is $66. Annual holding costs are 48 cents per hot dog. The factory operates 288 days a year.
a. Find the optimal run size. (Do not round intermediate calculations. Round your answer to the nearest whole number.)
Optimal run size
b. Find the number of runs per year. (Round your answer to the nearest whole number.)
Number of runs
c. Find the length (in days) of a run. (Round your answer to the nearest whole number.)
Run length (in days)
Explanation / Answer
Soutions-
D = 288 days a year
S= 370 per day
p= 6000
u= 370
H= 66
a) Find the optimal run size
Optimal Run Size = 2DS/ H x p/ ( p – u)
Optimal Run Size =2 (106560* 66)/ (0.48) x 6000/ (6000–370)
Optimal Run Size = 5413.32 * 1.032
Optimal Run Size = 5589
b) Find the number of runs per year
= 106560/5589 = 19
number of runs per year= 19
c) Find the length (in days) of a run
= 5589/6000
= 0.93
= 1 day
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