Final answer:
The costs associated with the retailer's demand for SKU 707BOE brown place mats include the cost of placing an order, holding cost, and EOQ (economic order quantity). The cost of placing an order refers to the expenses incurred by the retailer when submitting an order. Holding cost refers to the expenses incurred by the retailer for storing and maintaining inventory. EOQ is the optimal order quantity that minimizes the total cost of ordering and holding inventory.
Step-by-step explanation:
The costs associated with the retailer's demand for SKU 707BOE brown place mats include the cost of placing an order, holding cost, and EOQ (economic order quantity).
The cost of placing an order refers to the expenses incurred by the retailer when submitting an order for the brown place mats. This can include administrative costs, processing fees, and any other expenses related to ordering the product.
Holding cost refers to the expenses incurred by the retailer for storing and maintaining inventory. For the brown place mats, this can include costs such as warehousing, storage space, insurance, and any other costs associated with keeping the product in stock.
EOQ, or economic order quantity, is the optimal order quantity that minimizes the total cost of ordering and holding inventory. It is a calculation that takes into account factors such as the cost of ordering, holding cost, and demand for the product. By determining the EOQ for the brown place mats, the retailer can minimize the costs associated with ordering and holding inventory.