A department store sells 10,000 pairs of pants per year. The store orders pants from a regionalwarehouse. Each time an order is placed, an ordering cost of $45 is incurred. The store pays $50for each pair of pants, and the cost of holding $1 worth of inventory for a year is estimated to bethe annual capital opportunity cost of 200. The department store believes that orders can bebacklogged at the cost of s = $15 per pair per year. DetermineA. The optimal order quantity.B. The maximum inventory level that will occur.C. The maximum shortage that will occur.%3D

Given, Demand, d=10000 pairs Ordering cost,o=$45 Holding cost,h= $1 Backorder cost,b=$15 a) The…

Answered: A department store sells 10,000 pairs…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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