Question

Pam runs a mail-order business for gym equipment. Annual demand for TricoFlexers is 17,500. The annual holding cost per unit is $2.25, and the cost to place an order is $68.

Answer 1

a) EOQ = Sqrt

Step-by-step explanation:

a) EOQ = Sqrt( 2 x A x O / C) = Sqrt( 2 x 16,000 x $50 / $2.5) = 800 b) New EOQ = Sqrt( 2 x 32,000 x $50 / $2.5) = 1,131.37 or 1,132 The EOQ does not d.