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The Super Discount store (open 24 hours a day, every day) sells 8-packs of paper towels, at the rate of approximately 420 packs per week.
The Super Discount store (open 24 hours a day, every day) sells 8-packs of paper towels, at the rate of approximately 420 packs per week. Because the towels are so bulky, the annual cost to carry them in inventory is estimated at $.50. The cost to place an order for more is $20 and it takes four days for an order to arrive.
a. Find the optimal order quantity.
b. What is the reorder point?
c. How often should an order be placed?
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