A Company Produces Item Y, and Uses the Basic EOQ

question 100

Short Answer

A company produces item Y, and uses the basic EOQ model for managing its inventory. Lead time to obtain item Y is two weeks. Demand is normally distributed with a mean of 400 units per week and a standard deviation of 40 units per week. The desired service level is 98.5%. The ordering cost is $20, and carrying cost is 20% of the items cost, which is $10.
-Determine the total annual inventory cost for product Y. Include the item cost in your calculations. (Assume 52 weeks of operation per year.)

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Definitions:

Dissociative Identity Disorder

A severe form of dissociation characterized by the presence of two or more distinct personality states or identities within an individual.

Depersonalization-derealization Disorder

A psychiatric disorder characterized by persistent or recurrent feelings of detachment from one's self or the environment.

Illness Anxiety Disorder

A chronic psychiatric disorder characterized by excessive worry about having a serious medical illness, despite having minor or no symptoms.

Excessive Worrying

A condition where an individual experiences persistent, excessive, and unrealistic worry about everyday things, significantly impacting daily functioning.