Question

An electronic store sells 3,000 HD TV sets every quarter of the year. Each TV set costs the store $ 270.00. The carrying cost is set at 2% of the purchase price per unit per year. Each time an order is placed it costs the store $ 120.00 The supplier charges $10 for delivery of each order. Calculate: a. Optimal order quantity b. Number of orders per year c. The supplier is willing to give a discount of 3% on the price of each set if the manager of the store orders 3,000 sets at a time. Should the manager accept the offer?

Answer 1

Answer:

Check the explanation

Explanation:

The Economic Order Quantity (EOQ) is the amount of units that a firm or an organization is expected to include to its inventory with each order to reduce minimally the overall costs of inventory—such as order costs, holding costs, and shortage costs.

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