An office supply store open 5 days a week must determine the best inventor) policy for boxes of copier paper. Weekly demand is nearly constant at 250 boxes and when orders are placed, then entire shipment arrives at once. The cost per box is S22 and the inventory holding cost is 30%. Orders are placed at a cost of S40 each, including preparation time and communication charges, and the lead time is 2 days.
Find the optimal order quantity.
How often should an order be placed?
How many orders will be placed in a year?
What is the total annual cost?