Question: Jane calculates her EOQ for the Gumbo Pot restaurant using the formula Q = SQUARE ROOT OF (2DS)/H where: D = 8, S = $5.00,

Jane calculates her EOQ for the Gumbo Pot

Jane calculates her EOQ for the Gumbo Pot restaurant using the formula Q = SQUARE ROOT OF (2DS)/H where: D = 8, S = $5.00, H = $10.00. Over the past year, Jane has seen demand for her gumbo double. In order to accommodate the increase in demand, Jane is trying to decide whether she should reduce setup costs to $1.00 or increase holding costs to $15.00. She can ONLY choose ONE of the two choices, NOT BOTH! Calculate the new EOQ at the doubled demand and the $1.00 setup cost holding all other variables constant. Next, calculate the new EOQ at the doubled demand and the $15.00 holding cost holding all other variables constant. Choose the correct answer below and the decision that Jane should make regarding the two choices. Select one or more: a. Reduce setup costs = 4.0, reduce holding costs = 2.83, Jane should reduce holding costs. b. Reduce setup costs = 4.0, reduce holding costs = 3.27, Jane should reduce holding costs. c. Reduce setup costs = 1.79, reduce holding costs = 3.27, Jane should reduce setup costs. d. Reduce setup costs = 2.83, reduce holding costs = 4.0, Jane should reduce setup costs. e. Reduce setup costs = 3.27, reduce holding costs = 1.79, Jane should reduce holding costs

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