Question
Demand for an item is projected to be 210 units per month. The monthly holding costs is $3 per unit and it costs $40 process
Demand for an item is projected to be 210 units per month. The monthly holding costs is $3 per unit and it costs $40 process an order
A) Determine the EOQ ??
EOQ ?
B-1) If the vendor is willing to offer the manager a discount of $4 per order for ordering in multiples of 50 units(eg. 50,100) would you advise the manager to take advantage of the offer?
Yes or no?
B-2) If so, what order quantity would you recommend?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
A To determine the Economic Order Quantity EOQ we need to use the following formula EOQ 2DS H Where ...
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Step: 2
Step: 3
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Operations Management
Authors: William J Stevenson, Mehran Hojati
4th Canadian edition
978-1259270154, 1259270157, 978-0071091428
