What is the most economical number of units to order


Problem: If your company has its carrying cost at 15% and its ordering cost at $9 per order. The estimated annual requirement is 48,000 units at a price of $4 per unit. Consider it as Deterministic demand model What is the most economical number of units to order? How many orders should be placed in a year? How often should an order be placed? What is the total annual ordering cost? What is the average inventory at any point in time? What is the holding cost for the average inventory? If the demand is increased by 25% What is the most economical number of units to order? How many orders should be placed in a year? How often should an order be placed? What is the total annual ordering cost?

 

 

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