A local furniture store is examining its inventory policy and ...

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A local furniture store is examining its inventory policy and considering using an economic order quantity (EOQ) approach for a popular table set that they have had difficulty keeping in stock. They have the following information about the set: Annual demand = 5000 sets Current order quantity = 750 Carrying cost = 2.00/unit/year Order cost = 450
 a. What is the current total annual cost?
  b. What is the economic order quantity?
  c. What is the total annual cost at the EOQ?

Question 2

The use of the relative frequency method to develop discrete probability distributions leads to what is called a
 a. binomial discrete distribution.
  b. empirical discrete distribution.
  c. non-uniform discrete distribution.
   d. uniform discrete distribution.

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Answer to Question 1

a. TC = (750/2) 2 + (5 000/750) (450) = 750 + 3000 = 3750
b. EOQ = Sq Root of (2)(5000)(450)/2 = 1500
c. TC = (1500/2)(2) + (5000/1500)(450) = 1500 + 1500 = 3000

Answer to Question 2

b

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