Answered step by step
Verified Expert Solution
Question
1 Approved Answer
ACaIifornia distn'butor of sporting equipment expects to sell 16,000 cases of tennis balls dun'ng the coming year at a steady rate. Yearly carrying costs {to
ACaIifornia distn'butor of sporting equipment expects to sell 16,000 cases of tennis balls dun'ng the coming year at a steady rate. Yearly carrying costs {to be computed on the average number of cases in stock during the year} are $10 per caser and the cost of placing an order with the manufacturer is $50. [3] Find the inventory cost incurred if the distributor orders 500 cases at a time during the year. [bl Determine the economic order quantity. that is, the order quantity that minimizes the inventory cost. Let x be the number of cases per order and r the number of orders placed per year. If C represents the inventory cost. then the objective equation is C 2 HI x. The constraint equation is rx 2 (Do not include the $ symbol in your answer.) [a] The inventory cost is $ (Simplify your answer.) (b) The economic order quantity is :l cases. (Simplify your answer.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started