( b ) The following details are available on a popular item used by BAFBA Ltd: Consumption...
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Question:
( b ) The following details are available on a popular item used by BAFBA Ltd:
Consumption of materials per month.............................20000 kgs
Cost of placing an order ............................................K800
Price per kg ............................................................. K32
Cost of storage.............................................................8%
REQUIRED:
Using the details abovecalculate:
(i) The EOQ , using the Appropriate formula
(ii) the number of orders to be placed in a year
(iii) In relation to EOQ , briefly explain the behavior of Ordering Costs and Carryingor Storage Costs( 4 marks)
Related Book For
Introduction to Operations Research
ISBN: 978-1259162985
10th edition
Authors: Frederick S. Hillier, Gerald J. Lieberman
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