A gift shop sells Little Lentils dolls at a steady pace of 10 per day, 310 days per year. The cost of the dolls is $5, and the gift shop uses an annual interest rate of 20 percent to compute holding cost. Question 1: If the shop wants to place an average of 20 replenishments orders per year, what order quantity should it use? Question 2: If the shop calculates EOQ for ordering dolls and gets 100, what is the implied fixed order cost (K) Question 3: If the shop estimates that the cost of placing an order is $10, what is the optimal order quantity (EOQ)?
A gift shop sells Little Lentils dolls at a steady pace of 10 per day, 310 days per year. The cost of the dolls is $5, and the gift shop uses an annual interest rate of 20 percent to compute holding cost. Question 1: If the shop wants to place an average of 20 replenishments orders per year, what order quantity should it use? Question 2: If the shop calculates EOQ for ordering dolls and gets 100, what is the implied fixed order cost (K) Question 3: If the shop estimates that the cost of placing an order is $10, what is the optimal order quantity (EOQ)?
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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A gift shop sells Little Lentils dolls at a steady pace of 10 per day, 310 days per year. The cost of the dolls is $5, and the gift shop uses an annual interest rate of 20 percent to compute holding cost.
Question 1: If the shop wants to place an average of 20 replenishments orders per year, what order quantity should it use?
Question 2: If the shop calculates EOQ for ordering dolls and gets 100, what is the implied fixed order cost (K)
Question 3: If the shop estimates that the cost of placing an order is $10, what is the optimal order quantity (EOQ)?
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