EOQ

Ross White's machine shop uses $2500$ brackets during the course of a

Qear, and this usage is relatively constant throughout the year. These

brackets are purchased from a supplier $100$ miles away for $$15$ each,

and the lead time is $2$ days. The holding cost per bracket per year is

$$1\mathrm{.}50($or $10\%$ of the unit cost$)$ and the ordering cost per order is

$$18\mathrm{.}75.$ There are $300$ working days per year.

a$.$ Develop a total cost model for this system.

b$.$ What is the EOQ for this problem?

c$.$ What is the cycle time?

d$.$ What is the reorder policy?

e$.$ What are the total annual holding and ordering costs associated

with your recommended EOQ $?$

f$.$ What is the total annual cost associated with your recommended

EOQ?