An on-line retailer sells 12000 pairs of shoes each month a


Fixed Cost per Order Problem

An on-line retailer sells 12,000 pairs of shoes each month. A pair of shoes costs $50 on average, and the retailer incurs an annual inventory carrying rate of 52 percent.

a) For what value of fixed cost per order would an order size of 8,000 units per replenishment would be optimal?

b) For what value of fixed cost per order would an order size of 2,000 per replenishment would be optimal?

Request for Solution File

Ask an Expert for Answer!!
Financial Management: An on-line retailer sells 12000 pairs of shoes each month a
Reference No:- TGS01282689

Expected delivery within 24 Hours