A wholesaler encounters a constant demand of 200 cases of one brand and box size of soap
Question:
a. Compute the EOQ for this product.
b. Assuming a constant lead time of 5 days for this product, what is the minimum reorder point that will allow the wholesaler to provide 100 percent customer service? Assume 5 operating days per week.
c. Determine the wholesaler’s total cost per year for this product.
d. The manufacturer offers the wholesaler a quantity discount of $ 1 per case for purchasing in quantities of 400 cases or more. Should the wholesaler take advantage of this quantity discount?
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Related Book For
Service Management Operations Strategy Information Technology
ISBN: 978-0077841201
8th edition
Authors: James Fitzsimmons, Mona Fitzsimmons, Sanjeev Bordoloi
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