. Quarter-inch stainless-steel bolts are consumed in a factory at a fairly steady rate of 60 per week. There are 52 weeks per year. The bolts cost the plant two cents each. It costs the plant $12 to initiate an order, and holding costs are based on an annual interest rate of 25%. There is no lead-time (instant receipt of orders).
2. a. Determine the optimal number of bolts for the plant to purchase and the time between orders.
b. What is the annual holding cost and setup (ordering) cost for this item? What is the total cost (holding + setup)?
c. Now, assume that the plant can only order batches of 60 bolts (that is, the order quantity has to be divisible by 60. Determine the minimal total (holding + setup) cost in such case.
d. Compared what yo