Y6

4.14 The Dartmouth Bookstore sells 300 notebooks per term. Each notebook carries a variable cost of $0.50, while the fixed cost to restock the shelves amounts to $4.00. The carrying charge of one notebook tied in the inventory is $0.08 per $/term. a. Calculate the EOQ. b. Calculate the total relevant cost associated with the EOQ calculated in the previous part. c. If the Dartmouth Bookstore instead chooses to order 300 notebooks instead of the EOQ, calculate the PCP of this order size. d. Calculate the best order quantity now considering a 40% discount on orders greater than 300. e. Calculate the optimal order quantity if the bookstore decides to incorporate an inflation rate of 2% in the decision. f. Assume that a particular notebook occupies 0.10 cubic foot of space, for which the bookstore figures that it costs them $2 per term per cubic foot. Calculate the best replenishment quantity under these circumstances. g. Now assume that the unit cost of the same notebook increases from $0.50 to $0.60. Calculate the new EO