Question

As part of its new Lean program, Qwik-and-Done has signed a long-term contract with Lighting Manufacturers and will now place orders for its LED lamps electronically. Ordering costs will drop to $0.50 per order, but carrying costs are raised to $19.1/lamp. What is the new EOQ?

Answer 1

≈ 10 lamps

Step-by-step explanation:

I think your question is missed of key information, allow me to add in and hope it will fit the original one.

Annual demand is: 2000

My answer:

Given that:

• Demand: 2000 (D)
• Ordering cost: $0.50 per order (S)
• Holding cost (carrying costs ): $19.1/lamp (H)

So the new EOQ is calculated as the following:

EOQ =
`\sqrt{(2DS)/(H) }`

<=> EOQ =
`\sqrt{(2*2000*0.5)/(19.1) }`

<=> EOQ = 10.23 ≈ 10 lamps

Hope it will find you well.