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If annual sales for your product are 715, and the holding cost per unit is $5, and the cost to place an order is $350, then: 1. Calculate the EOQ, and round it to 2 decimal places.  2. Calculate the ordering and holding costs, per year, if you use the EOQ.   What is the Sum of Ordering and Holding costs (rounded to nearest dollar)?

If annual sales for your product are 715, and the holding cost per unit is $5, and the cost to place an order is $350, then: 1. Calculate the EOQ, and round it to 2 decimal places.  2. Calculate the ordering and holding costs, per year, if you use the EOQ.   What is the Sum of Ordering and Holding costs (rounded to nearest dollar)?

Practical Management Science
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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If annual sales for your product are 715, and the holding cost per unit is $5, and the cost to place an order is $350, then:

1. Calculate the EOQ, and round it to 2 decimal places. 

2. Calculate the ordering and holding costs, per year, if you use the EOQ.  

What is the Sum of Ordering and Holding costs (rounded to nearest dollar)?

Expert Solution
Step 1

Annual Sales = 715

Holding Cost = 5 per unit

Order Cost = 350 per order

 

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