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A certain company has determined that the cost of being stocked out of motors is $150 for each unit and a carrying cost of $15
A certain company has determined that the cost of being stocked out of motors is $150 for each unit and a carrying cost of $15 per motor. The EOQ analysis indicates that the company should reorder 10 times each year. It has an average usage of 35 motors a day and lead time of 6 days. The company is considering dropping the reorder point from 250 to 220. Based on the information below, what would you advise the company to do? Use during reorder period, units 200 Probability 0.10 0.08 220 0.06 240 260 0.04 0.02 280 A certain company has determined that the cost of being stocked out of motors is $150 for each unit and a carrying cost of $15 per motor. The EOQ analysis indicates that the company should reorder 10 times each year. It has an average usage of 35 motors a day and lead time of 6 days. The company is considering dropping the reorder point from 250 to 220. Based on the information below, what would you advise the company to do? Use during reorder period, units 200 Probability 0.10 0.08 220 0.06 240 260 0.04 0.02 280
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