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As part of its new Lean program, Qwik-and-Done has signed a long-term contract with Lighting Manufacturers and will now place orders for its LED lamps electronically. Ordering costs will drop to $0.50 per order, but carrying costs are raised to $19.1/lamp. What is the new EOQ?

Respuesta :

thaovtp1407

Answer:

≈ 10 lamps

Explanation:

I think your question is missed of key information, allow me to add in and hope it will fit the original one.  

Annual demand is: 2000

My answer:

Given that:

  • Demand: 2000 (D)
  • Ordering cost: $0.50 per order (S)
  • Holding cost (carrying costs ): $19.1/lamp (H)

So the new EOQ is calculated as the following:

EOQ = [tex]\sqrt{\frac{2DS}{H} }[/tex]

<=> EOQ = [tex]\sqrt{\frac{2*2000*0.5}{19.1} }[/tex]

<=> EOQ = 10.23 ≈ 10 lamps

Hope it will find you well.

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