The annual demand for a specific product is 1,750 units. The purchase price (or item cost) per unit is $7.50. The purchase cost per purchase order is $75 and the holding cost per unit per year is $1.00. Find the economic purchase quantity and the corresponding annual minimum cost.
Added by Nathaniel T.
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The formula for EOQ is: $$EOQ = \sqrt{\frac{2DS}{H}}$$ where: * D is the annual demand * S is the cost per order * H is the holding cost per unit per year Show more…
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