Question
A hospital orders its blood from a regional blood bank. Each year, the hospital uses an average of 1040 pints of Type O blood. Each
A hospital orders its blood from a regional blood bank. Each year, the hospital uses an average of 1040 pints of Type O blood. Each order placed with the regional blood bank incurs a cost of $250. The lead time for each order is 5 days. It costs the hospital $20 to hold a single pint of blood in inventory for an entire year. A. What is the EOQ for blood purchases for this hospital? B. How many orders per year should be placed? C. What period of time should transpire between orders? D. Would safety stocks be more or less necessary for this product? Explain
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