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homework excerpts I don't know how to solve this question To solve this issue, the DC manager tried to improve warehouse inventory policies for the

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homework excerpts

I don't know how to solve this question

To solve this issue, the DC manager tried to improve warehouse inventory policies for the product with highest demand. The forecast for this product is 600 units for the year. The holding cost was estimated to be $1.5 per unit per month and the ordering cost was $50 per order. By taking appropriate assumptions, determine an order size that will minimize the inventory costs for each of the six-month period. Which inventory models will be appropriate if demand varies substantially in a year.

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Finding the E00 Q = number of pieces to order per order EOQ = Q* = optimal number of pieces to order D = annual demand in units for the inventory item Co = ordering cost of each order Ch = holding or carrying cost per unit per year Annual ordering cost = QC Q 0 . _ Q Annual holding cost 30,, EOQ=Q' = 2000

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