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Daily Usage of a Product Is 10 in a Facility

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Essay

Daily usage of a product is 10 in a facility that operates every day of the year.Setup cost is $68 and annualized carrying cost is $100.Daily production of this product is 20.Lead time is 14 days;safety stock is one day's production.What is the optimum kanban size,and number of kanbans?


Definitions:

Future Cash Flow

The projected movement of money into and out of a business or investment over future periods.

Avoidable Costs

Expenses that can be eliminated if a particular decision is made or if a business operation is discontinued.

Future Costs

Costs that have not yet been incurred but are expected to be spent in the future for operational or investment purposes.

Alternatives

Different options or strategies available for consideration in decision-making processes.

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