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Business, 09.08.2021 20:40 2024056

Filter Systems produces air filters for domestic and foreign cars. One filter, part number JJ39877, is supplied on an exclusive contract basis to Oil Changers at a constant 170 units monthly. Filter Systems can produce this filter at a rate of 50 per hour. Setup time to change the settings on the equipment is 1.5 hours. Plant idle time during setups is estimated to cost the firm $100 per hour in lost profit. Filter Systems has established a 25 percent annual interest charge for determining holding cost. Each filter costs the company $2.50 to produce; they are sold for $6.50 each to Oil Changers. Assume 6-hour days, 20 working days per month, and 12 months per year for your calculations. a. How many JJ39877 filters should Filter Systems produce in each production run of this part to minimize annual holding and setup costs

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Filter Systems produces air filters for domestic and foreign cars. One filter, part number JJ39877,...
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