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(15 pts) George Heinrich yearly uses 1500 units of a certain subassembly part that has an annual holding cost of $45 per unit. Each
(15 pts) George Heinrich yearly uses 1500 units of a certain subassembly part that has an annual holding cost of $45 per unit. Each order placed costs George $150. In one year he finds out that his forecasting department has made an error estimating the demand and instead of the correct demand they had reported the same 1500 units and calculated the EOQ resulting in an error of %1 underestimation in optimal total cost. Neglecting purchasing cost in your calculations, what is the correct demand value?
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To solve this problem we need to find the correct demand D D that leads to a 1 underestimation in the optimal total cost when the EOQ is calculated us...Get Instant Access to Expert-Tailored Solutions
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