Post Card Depot an large retailer of post cards, orders 8,924,780 post cards per

Question

Post Card Depot an large retailer of post cards, orders 8,924,780 post cards per year from its manufacturer Post Card Depot plans on ordering post card 13 times over the next year. Post Card Depot receives the same number of post cards each time it orders. The carrying cost is 50 22 per post card per year The ordering cost is $224 per ordes What is the annual ordering cost of the post card i Round the arswer to two decimal places) Your Answer se ORse Answer Save Nec Page Page 2 of 3 Save All Responses Go to Submis Quiz

Explanation / Answer

Economic order quantity = Square root of ((2*Order cost*demand)/carrying cost)

Economic order quantity = Square root of (2*8924780*224/.22)

= Square root of 18174097454

= 134811

number of orders = 8924780/134811

= Approx 67 orders

Ordering cost = 67* $224 = $15008

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