Question: A hardware store procures and sells hardware items. Information on an item is given here: The item can be purchased according to the following schedule:

A hardware store procures and sells hardware items. Information on an item is given here:

Expected annual sales Ordering cost Holding cost = 8,000 units Rs 180

The item can be purchased according to the following schedule:

per order = 10% of the average inventory value

You are required to determine the best order size.

Expected annual sales Ordering cost Holding cost = 8,000 units Rs 180 per order = 10% of the average inventory value

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