Question: You work for a retailer that sells computer games. One of those games is Quex. Answer the following questions using this information: Annual demand is

You work for a retailer that sells computer games. One of those games is Quex. Answer the following questions using this information:

  • Annual demand is 3,000 games
  • Ordering cost is $50 each time an order is placed
  • Inventory holding/carrying cost is 20% of the item purchase cost
  • Purchase cost is $20 per game

You are currently ordering 1000 games each time you place an order. What is the total annual cost? What are the ordering costs? What are the holding/carrying costs?

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