Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Pam runs a mail-order business for gym equipment. Annual demand for TricoFlexers is 13,500 . The annual holding cost per unit is $2.25, and the

image text in transcribed

Pam runs a mail-order business for gym equipment. Annual demand for TricoFlexers is 13,500 . The annual holding cost per unit is $2.25, and the cost to place an order is $65. a. What is the economic order quantity? The EOQ is (Enter your response rounded to the nearest whole number.) b. Suppose demand for TricoFlexers doubles, to 27,000 . The EOQ for the new value of demand is (Enter your response rounded to the nearest whole number.) Does the EOQ also double? A. No, the EOQ does not double as the annual demand doubles. The EOQ is inversely proportional to the demand. B. No, the EOQ does not double as thernnual demand doubles. The EOQ is inversely proportional to the square-root of the demand. C. No, the EOQ does not double as the annual demand doubles. The EOQ increases by the square-root of the product of two-times the demand times ordering cost, divided by holding cost. D. Yes, the EOQ doubles because the EOQ is directly proportional to the demand. c. The manufacturer of TricoFlexers has agreed to offer Pam a price discount of $10 per unit ( $55 rather than $65) if she buys 2,000 . Assuming that annual demand is still 13,500 , how many units should Pam order at a time? Pam should order units at a time. (Enter your response rounded to the nearest whole number.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managing Supply Chain and Operations An Integrative Approach

Authors: Thomas Foster, Scott E. Sampson, Cynthia Wallin, Scott W Webb

1st edition

132832402, 978-0132832403

More Books

Students also viewed these General Management questions

Question

List the slope and y-int ercep f(x)=2x-5

Answered: 1 week ago