Question
Sam and Jazmyn graduated from business school together. They are now inventory managers for competing distributers. Both are purchasing 50-horsepower speedboat engines from the same
Sam and Jazmyn graduated from business school together. They are now inventory managers for competing distributers. Both are purchasing 50-horsepower speedboat engines from the same manufacturer. Sam has found the setup cost for initiating each order to be $300 and the unit holding cost to be $600.
Sam has learned that Jazmyn is ordering 20 engines each time. Sam assumes that Jazmyn is using the basic EOQ model and has the same set up and unit holding costs as Sam. Show how Sam can use this information to deduce what the annual demand rate must be for Jazmyn's company for these engines.
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