Find the economic order quantity and the reorder point

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Reference no: EM131785469

We use 2,750 per year of a certain subassembly that has a purchase cost of $450, and an annual holding cost of $400 per unit. Each order placed costs us $150. We operate 200 days per year and have found that an order must be placed with our supplier 12 working days before we can expect to receive that order.

For this subassembly, find:

(a) the economic order quantity

(b) the reorder point

Reference no: EM131785469

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