A printing company estimates that it will require 1,000 reams of a certain type of paper in a given period. The cost of carrying one unit in inventory for that period is 50 cents. The company buys the paper from a wholesaler at a cost of $20 per trip.
Treating this cost as the order cost, What is the optimum number of reams to buy at one time?
How many times should lots of this size be bought during this period?
What is the minimum cost of maintaining inventory on this item for the period?
Of this total cost, how much is carrying cost and how much is ordering cost?
I can't seem to figure this out in it's entirety any help is greatly appreciated!
Treating this cost as the order cost, What is the optimum number of reams to buy at one time?
How many times should lots of this size be bought during this period?
What is the minimum cost of maintaining inventory on this item for the period?
Of this total cost, how much is carrying cost and how much is ordering cost?
I can't seem to figure this out in it's entirety any help is greatly appreciated!