Question

Babble, Inc., buys 405 blank cassette tapes per month for use in producing foreign language courseware. The ordering cost is ​$15.00. Holding cost is ​$0.25 per cassette per year. a. How many tapes should Babble order at a​ time?

Answer 1

Answer:

The appropriate solution is "764".

Explanation:

Given:

Demand per month,

D = 405

or,

  = $405\times 12$

  = $4860$

Ordering cost,

S = $15

Holding cost,

H = $0.25

As we know,

⇒  $EOQ=\sqrt{\frac{2DS}{H} }$

⇒            $=\sqrt{\frac{2\times 4860\times 15}{0.25} }$

⇒            $=\sqrt{\frac{145800}{0.25} }$

⇒            $=\sqrt{583200}$

⇒            $=763.67$

or,

⇒            $=764$