?Ollah's Organic Pet Shop sells about 6 comma 0006,000 bags of?free-range dog biscuits every year. The fixed ordering cost is$3030?, and the cost of holding a bag in inventory for a year is?$1.251.25.
Click the icon to view the table of z values.
z value
0.84 | ?80% |
1.28 | ?90% |
1.65 | ?95% |
2.33 | ?99% |
3.08 | ?99.9% |
a. What is the economic order quantity for the?biscuits?
The EOQ is
?(Enter your response rounded to the nearestwhole number.?)
b. Suppose Ollah decides to order 280280 bagsat a time. What would the total ordering and holding costs for theyear? be? (For this? problem, don't consider safety stock whencalculating holding? costs.)
The total ordering and holding costs are
?(Enter your response rounded to the nearestdollar.?)
c. Average weekly demand for? free-range dogbiscuits is 9292 bags per? week, with a standard deviation of 2323bags. Ollah uses a continuous inventory review system to manageinventory of the biscuits. Ollah wants to set the reorder pointhigh enough that there is only a 2020?% chance of running outbefore the next order comes in. Assuming that the lead time is aconstant 77 weeks, what should the reorder point? be?
The reorder point is ........bags. ?(Enter your responserounded to the nearest whole? number.)
