How many months supply should purchasing director order


Central University uses $96,000 annually of a particular reagent in the chemistry department labs. The purchasing director of the university estimates the ordering cost at $45 and thinks that the university can hold this type of inventory at an annual storage cost of 22% of the purchase price. How many months supply should purchasing director order at one time to minimize total annual cost of purchasing and carrying.

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Business Management: How many months supply should purchasing director order
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