What is the optimal interval between the orders

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Reference no: EM132128433

A specialty coffeehouse sells Colombian coffee at a fairly steady rate of 72 pounds per week. The beans are purchased from a local supplier for $5 per pound. The coffeehouse estimates that it costs $65 in paperwork and labor to place an order for the coffee, and the annual unit holding cost is 25% of the purchasing price per pound. (Use 52 weeks/year) a) What is the economic order quantity (EOQ) for Colombian coffee? b) What is the optimal number of orders per year? c) What is the optimal interval (in weeks) between the orders?

Reference no: EM132128433

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