You are inventory manager for of Diego Supplies Inc. You computed the EOQ to be 500 units. Annual demand for the company is 5,000 units, and holding cost is $4 per unit. What is the ordering cost?
Added by Yovana B.
Step 1
We know the EOQ (Economic Order Quantity) formula is: EOQ = √(2DS / H) Where: D = Annual demand (5,000 units) S = Ordering cost (which we need to find) H = Holding cost per unit ($4 per unit) Show more…
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