Question

What is the optimal order quantity for the universal TV remote control device, considering an expected daily demand of 25 units over 250 working days a year, a purchase cost of $20 per unit, and an annual holding cost of $4 per unit?

a) 50 units
b) 100 units
c) 500 units
d) 1000 units

Answer 1

The question asks for the optimal order quantity for a universal TV remote control but doesn't provide the order cost required for EOQ calculation.

Step-by-step explanation:

The question asks for the optimal order quantity for a universal TV remote control device, given the daily demand, purchase cost per unit, and annual holding cost per unit. To determine the optimal order quantity, the Economic Order Quantity (EOQ) formula can be used:
EOQ = √((2 * Demand * Order cost) / Holding cost). However, as the order cost is not provided in the question, we cannot calculate the EOQ accurately. Typically, the optimal order quantity is the one that minimizes the total cost that includes the order cost, purchase cost, and holding cost.