Question: Use EOQ model to solve following problem. The item is demanded 5 0 weeks a year. Item cost: $ 1 0 Fixed Order cost: $

Use EOQ model to solve following problem. The item is demanded 50
weeks a year.
Item cost: $10
Fixed Order cost: $250
Annual holding cost: 25% of item cost
Average demand: 500 per week, constant rate. If your purchase quantity is equal to or above 3000, the fixed ordering cost is reduced to
$200. Would you take advantage of it? How much would you save annually?

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