Pam runs a mail-order business for gym equipment annual, Ask an Expert

Management Studies

Pam runs a? mail-order business for gym equipment. Annual demand for TricoFlexers is 13 comma 50013,500. The annual holding cost per unit is ?$3.003.00?, and the cost to place an order is ?$5555.

a. What is the economic order? quantity?

The EOQ is ___. ?(Enter your response rounded to the nearest whole? number.)

b. Suppose demand for TricoFlexers? doubles, to 27,000.

The EOQ for the new value of demand is ____. ?(Enter your response rounded to the nearest whole? number.)

Does the EOQ also? double?

A. ?Yes, the EOQ doubles because the EOQ is directly proportional to the demand.

B. ?No, the EOQ does not double as the annual demand doubles. The EOQ is inversely proportional to the? square-root of the demand.

C. ?No, the EOQ does not double as the annual demand doubles. The EOQ increases by the? square-root of the product of? two-times the demand times ordering? cost, divided by holding cost.

D. ?No, the EOQ does not double as the annual demand doubles. The EOQ is inversely proportional to the demand.

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M93109340

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