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Introduction to Materials Management 8th Edition by Steve Chapman ,Tony Arnold ,Ann Gatewood ,Lloyd Clive
Edition 8ISBN: 978-0134156323Introduction to Materials Management 8th Edition by Steve Chapman ,Tony Arnold ,Ann Gatewood ,Lloyd Clive
Edition 8ISBN: 978-0134156323 Exercise 4
A company wishes to establish an EOQ for an item for which the annual demand is $800,000, the ordering cost is $32, and the cost of carrying inventory is 20%. Calculate the following:
a. The EOQ in dollars.
b. Number of orders per year.
c. Cost of ordering, cost of carrying inventory, and total cost.
d. How do the costs of carrying inventory compare with the costs of ordering?
a. The EOQ in dollars.
b. Number of orders per year.
c. Cost of ordering, cost of carrying inventory, and total cost.
d. How do the costs of carrying inventory compare with the costs of ordering?
Explanation
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EOQ:
EOQ stands for economic order quan...
Introduction to Materials Management 8th Edition by Steve Chapman ,Tony Arnold ,Ann Gatewood ,Lloyd Clive
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