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Q: Franz Beckenbauer and Johan Cruyff are purchasing managers for the headquarters of a large sports marketing company chain with a central inventory operation. Their
Q: Franz Beckenbauer and Johan Cruyff are purchasing managers for the headquarters of a large sports marketing company chain with a central inventory operation. Their fastestmoving inventory item has a daily demand of units. The cost of each unit is and the inventory carrying cost is per unit per year. The average ordering cost is per order. It takes about days for an order to arrive, and there are working days per year.
QA To minimize the cost, how many units should be ordered each time an order is placed? What is the total annual inventory cost, including the cost of the units?
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