A Product Has an Annual Demand of 3600 Units

question 153

Short Answer

A product has an annual demand of 3600 units. Unit cost for this product is $3. Set up cost is $20 and the inventory carrying rate as a percent of the unit cost is 25%. The product is produced in-house where the daily production rate is 50 units. Assume 360 working days per year and determine the economic production quantity.

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Definitions:

Primary Reinforcer

A stimulus that satisfies a basic survival need and thus inherently reinforces and increases the likelihood of a behavior associated with it.

Secondary Reinforcer

A stimulus that becomes reinforcing through its association with a primary reinforcer, not inherently rewarding but has learned value.

Operant Conditioning

A pedagogical process that modifies the intensity of behavior with either encouragement or discipline.

Primary Reinforcer

A fundamental stimulus that satisfies basic survival needs and is naturally reinforcing, such as food or water.