Sumco's annual demand is expected to increase from 1,000 units to 1,500 units, the ordering cost is reduced to $8 per order and the average carrying cost per unit per year is increased to $0.80. Under these new conditions: A) Calculate the new EOQ. B) Calculate the Annual Ordering Cost, the Annual Holding Cost and the Total Annual Cost. C) Plot a graph showing Ordering Cost, Holding Cost and Total Cost as a function of Q for this problem

Sumco's annual demand is expected to increase from 1,000 units to 1,500 units, the ordering cost is reduced to $8 per order and the average carrying cost per unit per year is increased to $0.80. Under these new conditions: A) Calculate the new EOQ. B) Calculate the Annual Ordering Cost, the Annual Holding Cost and the Total Annual Cost. C) Plot a graph showing Ordering Cost, Holding Cost and Total Cost as a function of Q for this problem

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Chapter16: Lean Supply Chain Management

Section: Chapter Questions

Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...

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