Central University uses $123,000 of a particular toner cartridge for laser printers in the student computer labs each year. The purchasing director of the university estimates the ordering cost at $45 and thinks that the university can hold this type of inventory at an annual storage cost of 22% of the purchase price of $1 each. How many months' supply should the purchasing director order at one time to minimize the total annual cost of purchasing and carrying?

Answer rating: 100% (QA)

Annual Demand D 12300 units Ordering Cost 5 45 Purchase price c 1 Holding ... View the full answer