23. Suppose a clothing store sells jeans throughout the year. The average weekly sales of a...
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23. Suppose a clothing store sells jeans throughout the year. The average weekly sales of a particular brand are 192 pairs, with a standard deviation of 30 pairs. The supplier charges $40 per pair, and the ordering cost is $20. The annual holding cost is 25% of the jeans' value. The lead time for replenishing the jeans stock is constant at four weeks. Management desires a 98% service level. Please determine a) the optimal order quantity (EOQ), b) safety stock (SS), c) reorder point (ROP), and d) total cost using this information. 23. Suppose a clothing store sells jeans throughout the year. The average weekly sales of a particular brand are 192 pairs, with a standard deviation of 30 pairs. The supplier charges $40 per pair, and the ordering cost is $20. The annual holding cost is 25% of the jeans' value. The lead time for replenishing the jeans stock is constant at four weeks. Management desires a 98% service level. Please determine a) the optimal order quantity (EOQ), b) safety stock (SS), c) reorder point (ROP), and d) total cost using this information.
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To determine the optimal order quantity EOQ safety stock SS reorder point ROP and total cost we can use the Economic Order Quantity EOQ model Lets cal... View the full answer
Related Book For
College Mathematics for Business Economics Life Sciences and Social Sciences
ISBN: 978-0321614001
12th edition
Authors: Raymond A. Barnett, Michael R. Ziegler, Karl E. Byleen
Posted Date:
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