Notes
Outline
EOQ Example
Economic Order Quantity
Ken Homa
EOQ
Example
You’re a buyer for SaveMart.
SaveMart needs 1000 coffee makers per year.  The cost of each coffee maker is $78.  Ordering cost is $100 per order.  Carrying cost is 40% of per unit cost.  Lead time is 5 days.  SaveMart is open 365 days/yr.  What is the optimal order quantity & ROP?
 SaveMart EOQ
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