Question
As a result of many process improvements and IT implementations (like EDI), Big Box-Mart has been able to reduce its order costs from $18.73 to
As a result of many process improvements and IT implementations (like EDI), Big Box-Mart has been able to reduce its order costs from $18.73 to $3.75when purchasing cases of paper towels from its main paper-products supplier. Annual demand is expected to be 271,000 cases and annual holding costs are $6.00 per case.
This is a purchasing order quantity problem (EOQ), not a production order quantity problem.
Based on this information, what will be the new optimal order quantity (using the reducedordering cost)? (Display your answer to the nearest whole number.)
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