Question

A local distributor for a national tire company expects to sell approximately 9,530 tires of a certain size and tread design next year. Annual carrying cost is $14 per tire and ordering cost is $72. The distributor operates 286 days a year. a. What is the EOQ

Answer 1

the economic order quantity is 313 units

Step-by-step explanation:

The computation of the economic order quantity is shown below:

= sqrt( 2 ×annual demand × ordering cost) (carrying cost)

= sqrt(2 × 95,30 × $72) ÷ $14

= 313 units

hence, the economic order quantity is 313 units

The same should be considered and relevant