Question: Verify your answer for the optimal order quantity obtained in part ( d ) by applying the EOQ formula by hand. ( f ) With
Verify your answer for the optimal order quantity obtained inpart d by applying the EOQ formula by hand.f With the optimal order quantity obtained above, how Tim Madsen is the purchasing agent for Computer Center,a large discount computer store. He has recently added the hottestnew computer, the Power model, to the stores stock of goods. Salesof this model now are running at about per week. Tim purchasesthese computers directly from the manufacturer at a unit cost of$ where each shipment takes half a week to arrive.Tim routinely uses the basic EOQ model to determine thestores inventory policy for each of its more important products. Forthis purpose, he estimates that the annual cost of holding items ininventory is percent of their purchase cost. He also estimates thatthe administrative cost associated with placing each order is $
inventory level be when each order isplacedg How much does the optimal inventory policy reduce thetotal variable inventory cost per year holding costs plusadministrative costs for placing orders for Power modelcomputers from that for the policy described in part aWhat is the percentage reduction
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