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Determine the economic order quantity model

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Reference no: EM133053560

Question - A firm estimated demand for a raw material during the next years is 2500 units. Acquisition costs are shs. 400 per order and carrying cost is shs. 50 per unit. The Safety stock is set at 25% of the Economic Order Quantity. The daily usage is 10 units and the Lead time is 10 days.

Required -

1. Determine the Economic order quantity model (EOQ).

2. Determine the safety Stocks.

3. Determine the re-order point.

Reference no: EM133053560

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