Chapter $20$: Inventory Management

$10.$ Assume that you are planning to make a one$-$time purchasing decision for a seasonal product. The variable cost per unit is $$80.$ During the season, the selling price is $$125$ per unit. After the season is over, any product not sold will be liquidated at a discount store for $$20.$ Based on historical data, you expect the demand to have an average of $13,000$ and a standard deviation of $5,555$ units.

How many units should you purchase?

$80$ unit

$$125/$ unit

$$20$ liquidated

A $13,000$$$5555$

$11.$ If annual demand is $35,000$ units, the ordering cost is $$50$ per order, the cost per unit is

$6\mathrm{.}510\%$

$$6\mathrm{.}5$ and the holding cost is estimated to be $10\%$ of the unit cost per unit per year, What's the optimal order quantity using the fixed$-$order quantity $($EOQ$)$ model?

$D=35\mathrm{.}000$

$s=50$

$H$

Based on the EOQ found on question $11,$ numbers, what's the total holding cost?

Based on the EOQ found in question $11,$ how many orders will the company place over the year?