Ross white (see problem 6-27) wants to reconsider his decision of buying the brackets and is consid ering making the brackets in-house. he has deter mined that setup costs would be $25 in machinist time and lost production time, and 50 brackets could be produced in a day once the machine has been set up. ross estimates that the cost (including labor time and materials) of producing one bracket would be $14.80. the holding cost would be 10% of this cost. (a) what is the daily demand rate? (b) what is the optimal production quantity? (c) how long will it take to produce the optimal quantity? how much inventory is sold during this time? (d) if ross uses the optimal production quantity. what would be the maximum inventory level? what would be the average inventory level? what is the annual holding cost? (e) how many production runs would there be each year? what would be the annual setup cost? (f given the optimal production run size, what is the total annual inventory cost? (g) if the lead time is one-half day, what is the rop?

answer; empowerment and collaboration;

of the three mortgage options that demarco and tanya have to choose from, the balloon payment mortgage would be their best option, over adjustable payment and fixed payment plans.ultimately, the balloon payment plan would save demarco and tanya overall, in interest, would cost less monthly, and they would only have to make these payments for 8 years, opposing to 30 years for adjustable or fixed payment plans. 

overall, demarco and tanya would save $80,811 if they chose balloon payments over fixed payments, and would save $116,711 if they choose balloon payments over adjustable payments. benefits with choosing fixed payments over adjustable payments is that, in the end, the payments will still be $836.30 a month, while with adjustable payments, the initial monthly payments will be $763.38 to $1082.70 a month, ultimately leading to a more costly purchase. benefits with choosing fixed payments over balloon payments are not present. benefits in choosing adjustable payments over is that it has a lower interest rate, and starts with lower monthly payments initially. benefits in choosing adjustable payments over balloon payments include a lower interest rate, and lower initial monthly payments. benefits in choosing balloon payments over fixed payments include lower interest rates, lower overall price, lower monthly payments, takes less time to pay off, and does not require a downpayment. benefits in choosing balloon payments over adjustable payments include, lower monthly payments (when averaged), takes less time to pay off, and lower overall price.

hence, option c, balloon payments, is the best option for demarco and tanya to make this purchase, for it will save them a minimum of $80811, and a maximum of $116,711.