OUESTION $2$

A$.$ State any two $(2)$ objectives of calculating Economic Order Quantity $($EOQ$).$

B$.$ A manufacturing company uses $40,000kg$ of raw material per annum to produce their product. The material is purchased for RM$5$ per kg$.$ The cost of placing an order is RM$100$ and the cost of storing $1kg$ material is at $20\%$ from its purchased price. The company minimum usage per week is $600kg$ and maximum usage is $1000kg.$ The lead time for re$-$order is $2$ to $4$ weeks.

Required:

Identify the followings:

i$)$ Economic order quantity $($EOQ$).$

ii$)$ Re$-$order Level

iii$)$ Minimum stock level

iv$)$ Maximum stock level