Question: 3 a ) A company uses 1 , 2 5 0 large cans of tomatoes a month, at an average rate of 5 0 per
a A company uses large cans of tomatoes a month, at an average rate of per
day for each of the days per month the company is working. Usage can be approximated by a normal distribution with a standard deviation of cans per day. Lead time is constant at days. Monthly carrying costs are per can and ordering costs are per order.
i Determine the economic order quantity.
ii Find the variable inventory costs per month.
iii. For a service level of per cent, how many cans of tomatoes should the company have on hand when it places the order?
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
