Long description
The data provided for explaining the E O Q model are as follows. In the first table, the cells with the figures are shaded yellow.
| Annual demand rate, D | 936 |
|---|---|
| Order cost, S | 45 |
| Holding cost percent | 25% |
| Unit price, P | 60 |
| Order quantity, Q star | Optimal, 75 | Other, 390 |
|---|---|---|
| Maximum inventory | Optimal, 75 | Other, 390 |
| Average inventory | Optimal, 37 | Other, 195 |
| Number of orders per year | Optimal, 12.49 | Other, 2.40 |
| Annual holding cost | Optimal, $562.05 | Other, $2,925.00 |
|---|---|---|
| Annual ordering cost | Optimal, $562.05 | Other, $108.00 |
| Total | Optimal, $1,124.10 | Other, $3,033.00 |
| Difference | $1,908.90 |
|---|---|
| % Difference | 169.82% |
The Inventory: Cost versus Quantity graph has a U-shaped total cost curve, a downward sloping order cost curve, and a linear ...
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