Question: . In a hardware house the demand for a commonly used bolt is 500 units per month. The ordering cost is $30 per order placed.

. In a hardware house the demand for a commonly used bolt is 500 units per month. The ordering cost is $30 per order placed. The carrying cost is 25% per year and each unit cost $.50. Lead time 7 days. The company operates 300 days per year.

(a) What is the economic order quantity?

(b) How often should this product be purchased?

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