Fixed cost per order probleman on-line retailer sells 12000, Ask an Expert

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Fixed Cost per Order Problem

An on-line retailer sells 12,000 pairs of shoes each month. A pair of shoes costs $50 on average, and the retailer incurs an annual inventory carrying rate of 52 percent.

a) For what value of fixed cost per order would an order size of 8,000 units per replenishment would be optimal?

b) For what value of fixed cost per order would an order size of 2,000 per replenishment would be optimal?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91671057

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