Optimal order quantity calculated above


A grocery store needs to sell 3,000 cartons of 2L 2% milk per month. The sales is relatively constant throughout the month. The owner of this grocery store purchases milk from a supplier 50 miles away for $2 per carton, and it takes a day to restock. The holding cost per carton per month is $1.5, and the ordering cost per order is about $18.5 including labor, gas and depreciation. Consider a month of 30 days.

The optimal order quantity is about____ cartons of milk, and the average inventory is about_____cartons.

Given the optimal order quantity calculated above, if the average inventory is 136 cartons, then the monthly holding cost is____dollars, and the total cost including the cost of supply or the total unit cost for all units, holding and ordering is_____dollars.

The reorder point is_____cartons

Request for Solution File

Ask an Expert for Answer!!
Basic Statistics: Optimal order quantity calculated above
Reference No:- TGS0747753

Expected delivery within 24 Hours