The best order size for its best-selling satellite dish

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Reference no: EM132133323

Ray’s Satellite Emporium wishes to determine the best order size for its best-selling satellite dish (Model TS111). Ray has estimated the annual demand for this model at 1,000 units. His cost to carry one unit is $10 per year per unit, and he has estimated that each order costs $25 to place. The purchase cost is $500 per unit.

For the order quantities Q = {25, 50, 75, 100, 125, 150}, find the annual setup ordering cost (S*D/Q), holding cost (H*Q/2), purchasing cost (C*D), and the total annual cost (including the purchase cost) Report the results for order quantity 25 in Answersheet.

Report the Q value with the minimum total cost (select from the list in cell B12) and the corresponding total cost in Answersheet.

Reference no: EM132133323

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