our organization sells X units of a product every month. Product cost is $350 with a holding cost of 20 percent.

INSTRUCTIONS TO CANDIDATES

ANSWER ALL QUESTIONS

Problem 1

Your organization sells X (provided in the data set below) units of a product every month. Data on the product is as follows:

. Product cost is $350 with a holding cost of 20 percent.

. Fixed cost for each order your organization places with the vendor is $4,000.

Respond to the prompts below using the following data set:

Problem Set 3 - Ql Data Set (XLXS)

Respond to the following questions:

. What is the optimal order size for your organization?

. What is the annual holding cost of the optimal policy?

. How many orders per year does your organization place?

. What ¡s the annual ordering cost?

Attachments:

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