Redraw Figure 20.7 assuming that carrying costs are $60 a ton and that each order involves a

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Redraw Figure 20.7 assuming that carrying costs are $60 a ton and that each order involves a fixed charge of $400.

a. What is the optimal order quantity?

b. Using your plot from part (a), about how many orders should the firm place a year?

c. What is the average size of the firm's inventory?

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Fundamentals of Corporate Finance

ISBN: 978-1259722615

9th edition

Authors: Richard Brealey, Stewart Myers, Alan Marcus

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Question Posted: Jun 24, 2017 09:00 AM

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Redraw Figure 20.7 assuming that carrying costs are $60 a ton and that each order involves a

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a We can implement the Economic Order Quantity formula In this example b The ...View the full answer

Fundamentals of Corporate Finance

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