Estimate the total holding cost

Assignment Help Operation Management

Reference no: EM13104693

The annual demand for a product has been projected at 2,000 units. This demand is assumed to be constant throughout the year. The ordering cost is $20 per order, and the holding cost is 20 percent of the purchase cost. Currently, the purchase cost is $40 per unit. There are 250 working days per year. Whenever an order is placed, it is known that the entire order will arrive on a truck in 6 days. Currently, the company is ordering 500 units each time an order is placed. What is the total holding cost for the year using this policy? A) $400 B) $2,000 C) $4,000 D) $8,000 E) None of the above

Reference no: EM13104693

Questions Cloud

Describe how to determine priority and message : Perform the two-page content analysis on this report to find out its major priority and message. In response, describe how you determined priority and message and upload to yur Student Folder.

Estimation of total ordering cost : Mark Achin sells 3,600 electric motors each year. The cost of these is $200 each, and demand is constant throughout the year. The cost of placing an order is $40, while the holding cost is $20 per unit per year.

Ci and hypothesis test : What is the relationship between a confidence interval and a single sample, two-tailed hypothesis test? How are they the same? How are they different?

Variation in the car rental rates : A researcher hypothesized that the variation in the car rental rates (in US$/day) at a major city airport is less than in the car rental rates down town.

Estimate the total holding cost : The annual demand for a product has been projected at 2,000 units. This demand is assumed to be constant throughout the year. The ordering cost is $20 per order, and the holding cost is 20 percent of the purchase cost.

Effective arguments and counterargument to support thesis : Where did you place the most effective arguments in the paper? Describe your reasoning. How did you explain counterarguments without weakening your own premise?

Describe the characteristics of firm with long cash cycle : What are some of the characteristics of a firm with a long cash cycle? Saunders Corp. has a book net worthof $13,205. Long-term debt is $8,200. Net working capital , other than cash, is $4,205. Fixed assets are$17,380.

Academic approach to confidence interval for mean : Find a point estimate of the population mean. Find the 95% confidence interval of the true mean. Assume the population standard deviation was 0.8.

Compare best plans in jc company and tucson park : Compare the best plans in the JC Company and the Tucson Parks and Recreation Department. What do they have in common?

User Account

All Pages