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The Wheeling Pottery Store begins each month with 1200 pots in stock. This stock is depleted each month and reordered. If the carrying cost per pot is $8 per year and the fixed order cost is $90, what is the total carrying cost?
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Write My Essay For MeWhat is the restocking cost? Should Wheeling increase or decrease its order size?
Describe an optimal inventory policy for Wheeling in terms of order size and order frequency.
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Solution Preview
Carrying Cost (H)= $8
Ordering Cost (S)= $90
Batch Size (Q) = 1200
Total Carrying Cost = Q/2*H
= 1200/2 * 8= $4800.
Annual Restocking Cost = S* No of …
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