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ANEK [815]
3 years ago
15

A manager receives a forecast for next year. Demand is projected to be 510 units for the first half of the year and 1,020 units

for the second half. The monthly holding cost is $2 per unit, and it costs an estimated $55 to process an order. a. Assuming that monthly demand will be level during each of the six-month periods covered by the forecast (e.g., 85 per month for each of the first six months), determine an order size that will minimize the sum of ordering and carrying costs for each of the six-month periods.
Business
1 answer:
lukranit [14]3 years ago
8 0

Answer:

290 units

Explanation:

The order size that will minimize the sum of ordering and carrying costs is known as the Optimum Order Quantity or Economic Order Quantity (EOQ).

At this point, the Ordering and Carrying costs will be at their minimal.

<em>Optimum Order Quantity = √2 × Annual Demand × Ordering Cost per unit ÷ Holding Cost per unit</em>

Where,

Annual Demand = 1st half + 2nd half

                           = 510 units + 1,020 units

                           = 1,530 units

Therefore

Optimum Order Quantity = √ (2 × 1,530 units × $55) ÷ $2

                                          = 290

Conclusion

The order size that will minimize the sum of ordering and carrying costs is 290 units

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Explanation:

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4 years ago
An investor is interested in selling 500 shares of her listed reit. the sale will be handled in a manner that's similar to the:_
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An investor is interested in selling 500 shares of her listed REIT. The sale will be handled in a manner that's similar to the real estate investment trusts are available on a secondary market (REITs). Prices for the vast majority of REITs traded on the NYSE are influenced by supply and demand.

What is REIT?

A firm that owns and often manages real estate or similar assets that generate income is known as a REIT. These could consist of warehouses, self-storage facilities, office buildings, commercial centers, residences, hotels, resorts, and mortgages or loans.

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Are real estate investment trusts a good investment?

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6 0
3 years ago
"For the next three questions, assume there is $20 per unit tax levied on the consumers of guitars. What price will buyers pay a
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Answer:

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