# Question

Madeline Thimme's Dream Store sells water beds and assorted supplies. Her best-selling bed has an annual demand of 400 units. Ordering cost is $40; holding cost is $5 per unit per year.

(a) To minimize the total cost, how many units should be ordered each time an order is placed?

(b) If the holding cost per unit was $6 instead of $5, what would be the optimal order quantity?

(a) To minimize the total cost, how many units should be ordered each time an order is placed?

(b) If the holding cost per unit was $6 instead of $5, what would be the optimal order quantity?

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