If the EOQ calculated falls within the discount range....what has to be done?
Please solve this question as an illustration:
A company has a demand for 45,000 components pa, which cost $4.50 each. Ordering costs amount to $100 per order. Annual cost of holding one component in inventory is $0.65.
A 0.5% discount is available on orders of at least 3,000 components and 0.75% on 6,000 components or more.
Calculate the optimal order quantity.
Please solve this question as an illustration:
A company has a demand for 45,000 components pa, which cost $4.50 each. Ordering costs amount to $100 per order. Annual cost of holding one component in inventory is $0.65.
A 0.5% discount is available on orders of at least 3,000 components and 0.75% on 6,000 components or more.
Calculate the optimal order quantity.
