EOQ reorder point, and safety stock. Alexis Company uses 800 units of a product per...
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EOQ reorder point, and safety stock. Alexis Company uses 800 units of a product per year on a continuous basis. The product has a fixed cost of $50 per order, and its carrying cost is $2 per unit per year. It takes 5 days to receive a shipment after an order is placed. And the firm wishes to hold 10 days usage in inventory as a saftety stock
Q: Indicate which of the following variables change if the firm does not hold the safety stock. 1) order costs, 2) carrying cost, 3) total inventory cost, 4) reorder point, 5) economic order point: Explain.
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