M. Cotteleer Electronics supplies microcomputer circuitry to a company that incorporates microprocessors into refrigerators and other...

Transcribed Image Text:

M. Cotteleer Electronics supplies microcomputer circuitry to a company that incorporates microprocessors into refrigerators and other home appliances. One of the components has an annual demand of 245 units, and this is constant throughout the year. Carrying cost is estimated to be $0.75 per unit per year, and the ordering (setup) cost is $21 per order. units (round your response a) To minimize cost, how many units should be ordered each time an order is placed? to two decimal places). orders (round your response to two decimal b) How many orders per year are needed with the optimal policy? places). c) What is the average inventory if costs are minimized? units (round your response to two decimal places). d) Suppose that the ordering (setup) cost is not $21, and Cotteleer has been ordering 175 units each time an order is placed. For this order policy (of Q = 175) to be optimal, the ordering (setup) cost would have to be ? (round your response to two decimal places). M. Cotteleer Electronics supplies microcomputer circuitry to a company that incorporates microprocessors into refrigerators and other home appliances. One of the components has an annual demand of 245 units, and this is constant throughout the year. Carrying cost is estimated to be $0.75 per unit per year, and the ordering (setup) cost is $21 per order. units (round your response a) To minimize cost, how many units should be ordered each time an order is placed? to two decimal places). orders (round your response to two decimal b) How many orders per year are needed with the optimal policy? places). c) What is the average inventory if costs are minimized? units (round your response to two decimal places). d) Suppose that the ordering (setup) cost is not $21, and Cotteleer has been ordering 175 units each time an order is placed. For this order policy (of Q = 175) to be optimal, the ordering (setup) cost would have to be ? (round your response to two decimal places).

Answer rating: 100% (QA)

To determine the optimal order quantity we can use the Economic Order Quantity EOQ formula Lets calc... View the full answer