Annual demand for an item is 40,000 units. The holding cost rate is 30% of the item cost. Ordering costs are $60/ order. Quantity discounts are available according to the schedule below:
Quantity Price per Unit ($)
1-99 90.00
100-299 85.00
300-399 80.00
400+ 78.00
What is the optimal order quantity (select the closest number) ?
From the previous problem, what is the total annual inventory cost of your policy (select the closest number)?
Continued from the previous 2 problems. Assume 52 five-day weeks per year. If the lead-time is 5 weeks, what should the reorder point be (select the closest number)?