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[EOQ] You manage the warehouse of Fort Worth ISD and you are considering the purchase of pencils, one of the high-demand items. Although an individual
[EOQ] You manage the warehouse of Fort Worth ISD and you are considering the purchase of pencils, one of the "high-demand" items. Although an individual school may fluctuate a bit in their demand, the aggregate demand for this item (from the 200 schools) is fairly constant at 3000 cases for the year. Due to the volume, your supplier has agreed to provide you an everyday low price of $3 a case. The board of education, tired of what they consider "wasted" use of the warehouse, is considering renting out excess space to a local business, and furthermore charging your cases the same market value for the space you use. You calculate that it will cost about $0.6 per case per year to hold each case (this also includes your costs of pilferage, which is excessive!). There is a lot of red tape and delivery charges by your supplier yields a fixed ordering cost of $100. (Hint: "h" is given).) a. [2 points] What is the optimal order size for cases of pencils? b. [1] How often should an order be placed
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