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A firm requires 9 0 , 0 0 0 units ( D ) over a 1 2 0 - day production period and is placing
A firm requires units D over a day production period and is placing orders equal quantity Inventory is used at a constant daily rate Ordering and Holding Costs are accounted for at end of the production period Ordering Costs OC are $ order and Holding Costs HC are unit based on average inventory The price per unit of inventory is $ C The firm pays for the inventory days after delivery The firm's cost of capital is For the inventory system HOLDING COSTS are : Total Cost Ordering Costs Holding Costs Item Cost Total Cost OCx D CD PV PVF Order Payment Due At t Cost Order Delivered At t Quantity Number $ $ ORDERING COSTS HOLDING COSTS
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