Question

A rice exporter buys rice from the only supplier. The demand of rice is certain throughout the year. Last year, the exporter exported 1,000 tons of rice. Ordering cost is $150 per order. The annual holding cost is 10% of the purchase cost. The exporter pays $500 per ton to the supplier.

a. What should the economic order quantity be?

b. What is the total annual holding cost?

c. What is the total annual ordering cost?

Answer 1

The answer is C I would explain but you probably only need the answer