Thomas Kratzer is the purchasing manager for the headquarters of a large insurance company chain with a central inventory operation. Thomas's fastest-moving inventory item has a demand of 6,100 units per year. The cost of each unit is $98, and the inventory carrying cost is $11 per unit per year. The average ordering costis $31 per order. It takes about 5 days for an order to arrive, and the demand for 1 week is 122 units. (This is a corporate operation, and there are 250 working days per year). a) Whatis the EOQ? units (round your response to two decimal places).
Thomas Kratzer is the purchasing manager for the headquarters of a large insurance company chain with a central inventory operation. Thomas's fastest-moving inventory item has a demand of 6,100 units per year. The cost of each unit is $98, and the inventory carrying cost is $11 per unit per year. The average ordering costis $31 per order. It takes about 5 days for an order to arrive, and the demand for 1 week is 122 units. (This is a corporate operation, and there are 250 working days per year). a) Whatis the EOQ? units (round your response to two decimal places).
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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