Cynthia Baker, Manager of a Large Medical Supply House That

question 26

Essay

Cynthia Baker, manager of a large medical supply house that operates 50 weeks per year and 5 days per week, has decided to implement a fixed period inventory system for all class A items.One such item has the following characteristics:
Demand = 10,000 units/year
Order cost = $50/order
Holding cost = $5/unit/year
If Baker wishes to minimize total cost (thereby approximating the EOQ), what should be T, the number of workdays between orders (i.e., review period)?

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