The Mongolia Company is a small manufacturing company that uses gear assemblies to produce four different models
Question:
The Mongolia Company is a small manufacturing company that uses gear assemblies to produce four different models of mountain bikes. One of these gear assemblies, the "Smooth Shifter", is used for the two most expensive of Burdell's four models, and has an estimated annual demand of 300 units. Burdell estimates the cost to place an order is $40, and the holding cost for each assembly is $60 per year. The company operates 250 days per year.
What is the annual ordering costs if Mwongola orders using the EOQ quantity?
greater than $350 but less than or equal to $500
greater than $200 but less than or equal to $350
greater than $500
less than or equal to $200
Managerial Decision Modeling with Spreadsheets
ISBN: 978-0136115830
3rd edition
Authors: Nagraj Balakrishnan, Barry Render, Jr. Ralph M. Stair