The park and smencer retail shop has observed a stable, Ask an Expert

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The park and smencer retail shop has observed a stable demand for its line of karmani sweater and do the order of 100 sweaters per week. The retail shop incurs a fixed cost of 200 every time place an order to the warehouse for stock replenishment. The marginal cost of a sweater is 45% and the shop’s cost of capital is approximately 25% per year. Assume there are 52 weeks per year

a. What quantity should be ordered each time?

b. What is the optimal inventory cost for a year?

c. What is the time duration between two consecutive orders?

d. What is the resulting inventory turnover rate?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M93136956

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