Question

suppose that the cost of holding one item in inventory is rs. 0.50 and that of placing an order is rs. 100.Also assume that the annual demand for the item is 4900 units.Find the economic order quantity. ​

Answer 1

Answer:

Determine the demand in units.

Determine the order cost (incremental cost to process and order)

Determine the holding cost (incremental cost to hold one unit in inventory)

Multiply the demand by 2, then multiply the result by the order cost.

Divide the result by the holding cost.

More items...•N

Answer 2

Economic order quantity (EOQ) = 1,400 units

Explanation:

Given:

Cost of holding = Rs 0.50

Order place cost = Rs 100

Annual demand = 4,900 units

Find:

Economic order quantity (EOQ)

Computation:

$EOQ = \sqrt{\frac{2DS}{H} } \\\\EOQ = \sqrt{\frac{2(4900)(100)}{0.50} } \\\\EOQ = \sqrt{\frac{2(4900)(100)}{0.50} } \\\\EOQ = 1,400 units$

Learn more:

https://brainly.in/question/9233994