The Demand for the 50 Kg Maize meal bag at Shoprite is 4000 units per month, Shoprite incurs a fixed order placement, transportation, and receiving cost of N$ 10 000 each time an order is placed. Each Bag of Maize meal cost Shoprite N$ 800 and the Shoprite has a holding cost of 20 percent as a fraction of unit cost. Calculate the following: (a)EOQ  (b)Average Inventory

Purchasing and Supply Chain Management
6th Edition
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Chapter16: Lean Supply Chain Management
Section: Chapter Questions
Problem 10DQ: The chapter presented various approaches for the control of inventory investment. Discuss three...
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The Demand for the 50 Kg Maize meal bag at Shoprite is 4000 units per month, Shoprite incurs a fixed order
placement, transportation, and receiving cost of N$ 10 000 each time an order is placed. Each Bag of Maize
meal cost Shoprite N$ 800 and the Shoprite has a holding cost of 20 percent as a fraction of unit cost.

Calculate the following:


(a)EOQ 
(b)Average Inventory 

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