14.A company uses Economic Order Quantity (EOQ) to arrive at optimal quantity for its single raw material. The following data relates to the inventory costs:
Purchase price $15 per item
Carriage costs $30 per order
Ordering costs $10 per order
Storage costs 20% of purchase price
Annual demand is 5,000 units.
What is the EOQ to the nearest whole unit?
A.177 units
B.100 units
C.365 units
Answer is B. 100 Units How ??
according to my calculations its 365 = square root (2*40*5000)/3
FIA Forums
Economic Order Quantity
I think you are right. Unless someone has another explanation.
Sign into reply to this topic.