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Optimal order quantity per order

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AV City stocks and sells a particular brand of laptop. It costs the firm $625 each time it places an order with the manufacturer for the laptops. The cost of carrying one laptop in inventory for a year is $130. The store manager estimates that total annual demand for the laptops will be 1500 units, with a constant demand rate throughout the year. Orders are received within minutes after placement from a local warehouse maintained by the manufacturer. The store policy is never to have stockouts of the laptops. The store is open for business every day of the year except Christmas Day. Determine the following.

(a) Optimal order quantity per order

(b) Minimum total annual inventory costs

(c) The number of orders per year

(d) The time between orders (in working days)

Reference no: EM131038591

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