Question: The material demanded is 10,000 units per year; the cost price of material is Tk.1 per unit, the cost of replenishing the stock of material

The material demanded is 10,000 units per year; the cost price of material is Tk.1 per unit, the cost of replenishing the stock of material per order regardless of the size Q of the order is Tk.25; and the cost of storing the material is 12.5% per year on the taka value of average quantity on hand.

Find the total cost function, economic order quantity and the total cost corresponding to that.

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