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A) What is the EOQ? B) If they order 1000 at a time, what are total ordering and holding costs per year? C) If they order 6000 at a time, what is the holding cost PER CAN? D)If they must order in multiples of 1920, how many should they order?

A) What is the EOQ? B) If they order 1000 at a time, what are total ordering and holding costs per year? C) If they order 6000 at a time, what is the holding cost PER CAN? D)If they must order in multiples of 1920, how many should they order?

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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8. An item sells for $1.25 per can with demand of 500 cans per week. They buy it for $.50 per can with an order cost of $20. Yearly inventory holding cost is 25%. A) What is the EOQ? B) If they order 1000 at a time, what are total ordering and holding costs per year? C) If they order 6000 at a time, what is the holding cost PER CAN? D)If they must order in multiples of 1920, how many should they order? E) If they order at least 7680 cans, they get a 4% discount. If they order 7680, what would be the ANNUAL ordering cost?
Transcribed Image Text:8. An item sells for $1.25 per can with demand of 500 cans per week. They buy it for $.50 per can with an order cost of $20. Yearly inventory holding cost is 25%. A) What is the EOQ? B) If they order 1000 at a time, what are total ordering and holding costs per year? C) If they order 6000 at a time, what is the holding cost PER CAN? D)If they must order in multiples of 1920, how many should they order? E) If they order at least 7680 cans, they get a 4% discount. If they order 7680, what would be the ANNUAL ordering cost?
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