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Case 2 Annual demand for Palace Corporation's Product X is 10,000 units. The company is unsure about the relevant carrying cost per unit for the
Case 2 Annual demand for Palace Corporation's Product X is 10,000 units. The company is unsure about the relevant carrying cost per unit for the year and the relevant ordering cost per purchase order. The company's purchasing agent prepared a table with six possible combinations of carrying costs and ordering costs. Carrying Cost per Year Alternative 1 Alternative 2 Alternative 3 Alternative 4 Alternative 5 Alternative 6 $20 $20 S30 S30 $40 $40 Ordering Cost per Purchase Order $240 $360 $240 $360 $240 $360 Required: (A) For each alternative, determine the EOQ for the relevant carrying costs and ordering costs. (B) How does your answer for (A) give you insight into the impact of EOQ of change in relevant carrying costs and ordering costs
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