Determination of Optimum Production Quantity for a Two-Stage Production System

Abstract

In this paper, a method is given for determining the optimum production quantity for a two-stage production system. The method assumes that a lot size is manufactured through two production stages with only one set-up at each stage. A production lot is manufactured in a number of sub-batches of sizes which reduce the total manufacturing cycle time of a production lot. The production quantity is considered 'optimum' when the sum of all the costs is minimized.