Question
Asked Apr 12, 2019
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A company orders and uses 2,880 boxes of office supplies. Each order has a fixed shipping cost of $200 and an additional cost of $3 per box of office supplies. To store a box for a full year costs $5. What is the optimal number of orders the company should make each year? Do not include units with your answer.

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Expert Answer

Step 1

We have given,

Annual usage of box =2,880

Shipping cost = $200

Additional cost per box = $3

Holding cost for a full year = $5 per box

Step 2

Formula for finding optimal number of orders given as:

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Step 3

Using above formula we can find,...

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