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Ierofanga [76]
3 years ago
5

Ray's Satellite Emporium wishes to determine the best order size for its best-selling satellite dish (model TS111). Ray has esti

mated the annual demand for this model at 850 units. His cost to carry one unit is $65 per year per unit, and he has estimated that each order costs $14 to place.
Business
1 answer:
sleet_krkn [62]3 years ago
5 0

Answer:

economic order quantity =  19 units

Explanation:

given data

Annual Demand = 850 units

Cost of carrying = $65 per unit

Ordering Cost = $14

solution

we get here economic order quantity that is  

economic order quantity = \sqrt{\frac{2 * Annual Demand *Ordering Cost}{
Cost of carrying}}    .....................1

put here value we get

economic order quantity = \sqrt{\frac{2*850*14}{65}}

economic order quantity = 19.13514

economic order quantity =  19 units

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