A pharmacy is considering employing the economic order, Ask an Expert

Management Studies

A pharmacy is considering employing the Economic Order Quantity invenory management system for the management of the seasonal flu vaccine, which it offers for sale to its customers.

Placing an order directly from the wholesaler costs the pharmacy $50 regardless of the number of doses ordered. Each dose of the flu vaccine costs the pharmacy $42.50. Because of the nature of the product, the inventory carrying cost is fixed at $7.72 per dose. The pharmacy expects that it will need 1000 doses to satisfy the entirety of its demand for the annual flu vaccine

Showing all work, calculate the Economic Oder Quantity (EOQ) rounded to one decimal place. As part of your calculation, please include:

1. Formula used to calculate the EOQ, Q*

2. Numerical values used in the formula.

3. Final (calculated) EOQ, rounded to one decimal place.

4. Interpretation: Articulate a summary sentence that explains the meaning of the calculated Economic Order Quantity (e: step 3)

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92179083

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