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PROBLEM: A store buys a product from its supplier for $100 per unit and sells it for $240 per unit. The yearly demand for the
PROBLEM: A store buys a product from its supplier for $100 per unit and sells it for $240 per unit. The yearly demand for the product is 1500 units. The supplier sends the order in a shipment 4 days after receiving the order. The store estimates the annual carrying cost per unit is 15% of the unit purchase cost. It also spends $130 to manage the ordering process and inspecting the shipment. The store operates 300 days per year. Assume EOQ model is appropriate.
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