Basic EOQ model summary

Total Costs $($TC$)=$ Annual setup cost $+$ Annual holding cost

$TC=(\frac{D}{Q})S+(\frac{Q}{2})H$

Basic economic order quantity $($EOQ$)$ model: The total cost is minimized at

$Q^{**}=\sqrt[\phantom{2}]{\frac{2DS}{H}}$

Expected number of orders

$(N)=\frac{\text{A}\text{n}\text{n}\text{u}\text{a}\text{l}\text{D}\text{e}\text{m}\text{a}\text{n}\text{d}(D)}{\text{O}\text{r}\text{d}\text{e}\text{r}\text{q}\text{u}\text{a}\text{n}\text{t}\text{i}\text{t}\text{y}(Q^{**})}$

Expected time between orders

For a product, the annual demand is $1,210$ units; the setup or ordering cost is $$10$ per order; and the holding cost per unit per year is $$0\mathrm{.}50.$ Assume that a year consists of $250$ working days.

Determine the optimal number of products to obtain per order.

Calculate the total cost with the economic order quantity

Calculate the expected number of orders per year with $Q^{**}$

Calculate the expected time between orders with $Q^{**}$