A firm is seeking better ways to manage their inventories of unicorn feed. They typically sell their
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A firm is seeking better ways to manage their inventories of unicorn feed. They typically sell their product for $200 per pallet. Because of its perishable nature it normally has a carrying cost of 50 percent. Order processing costs are estimated to be $31.25. In a typical year they handle 100,000 pallets. Assume a year has 360 days. Once an order is place it normally takes one week to receive it.
Using the information given above, determine the number of pallets they need to buy each time they place an order so they can minimize the over cost of their inventory of this item.
Using the information given above, determine when the firm needs to reorder.
Related Book For
Managing Business Ethics Making Ethical Decisions
ISBN: 9781506388595
1st Edition
Authors: Alfred A. Marcus, Timothy J. Hargrave
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