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Garden Variety Garden Variety Flower Shop uses 750 clay pots a month. The pots are purchased at $2 each. Annual carrying costs are estimated to be 25 percent of purchase cost, and ordering costs are $30 per order. R= 750 1. What is the economic order quantity? (pots/order) R (A) (B) (C) (D) (E) 525 750 820 950 1040

Garden Variety Garden Variety Flower Shop uses 750 clay pots a month. The pots are purchased at $2 each. Annual carrying costs are estimated to be 25 percent of purchase cost, and ordering costs are $30 per order. R= 750 1. What is the economic order quantity? (pots/order) R (A) (B) (C) (D) (E) 525 750 820 950 1040

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Garden Variety Garden Variety Flower Shop uses 750 clay pots a month. The pots are purchased at S2 each. Annual carrying costs are estimated to be 25 percent of purchase cost, and ordering costs are $30 per order. h=z 1. What is the economic order quantity? (pots/order) (A) (B) (C) (D) (E) 525 750 820 950 1040 2. What is the resulting total carrying and ordering cost per year? ($/year) (A) (B) (C) (D) (E) 520 570 620 670 720 Suppose an analysis shows the true carrying costs are double the current estimate. 3. What is the economic order quantity? (pots/order) (A) (B) (C (D) (E) 525 750 820 950 1040 4. If Garden Variety does not change the hatch size appropriately, how much more would the company pay per year than it neeas to? ($/year) (Hint: The current 25 percent figure will influence the firm's beliefs about noiding costs, but not the actual costs.) (A) (В) (C) (D) (E) 45 70 95 120 145
Transcribed Image Text:Garden Variety Garden Variety Flower Shop uses 750 clay pots a month. The pots are purchased at S2 each. Annual carrying costs are estimated to be 25 percent of purchase cost, and ordering costs are $30 per order. h=z 1. What is the economic order quantity? (pots/order) (A) (B) (C) (D) (E) 525 750 820 950 1040 2. What is the resulting total carrying and ordering cost per year? ($/year) (A) (B) (C) (D) (E) 520 570 620 670 720 Suppose an analysis shows the true carrying costs are double the current estimate. 3. What is the economic order quantity? (pots/order) (A) (B) (C (D) (E) 525 750 820 950 1040 4. If Garden Variety does not change the hatch size appropriately, how much more would the company pay per year than it neeas to? ($/year) (Hint: The current 25 percent figure will influence the firm's beliefs about noiding costs, but not the actual costs.) (A) (В) (C) (D) (E) 45 70 95 120 145
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