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Continuing with the Information About the City Pool Chemical Testing

Question 114

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Continuing with the information about the city pool chemical testing in another problem,the city could make this reagent at the rate of 1/4 gallon per day,at a cost of $500 per gallon.The setup cost is $125.Using a 7-day week,the daily demand,d,is 1/21 = 0.0477.Compare using the EOQ and the ELS systems.What course of action do you recommend?

Correct Answer:

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EOQ = D = 1/3 gal/wk × 52 wks/yr - 17.33...

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