here are 35 questions on this exam worth a total of 75 points. Most are worth 1
ID: 383841 • Letter: H
Question
here are 35 questions on this exam worth a total of 75 points. Most are worth 1 or 2 points, some are worth 4 or 5 points Manage your time accordingly. D Question 3 2 pts Every year a bookstore chain sells about 7200 copies of The Art of the Steal. Assume that the assumptions of the EOQ model are satisfied. If the chain orders in quantities of 1800 copies each time it places an order, then: It carries an average inventory of 900 books and orders 4 times a year O It carries an average inventory of 1800 books and orders 4 times a year It carries an average inventory of 900 books and orders 2 times a year It carries an average inventory of 1800 books and orders 3 times a yearExplanation / Answer
Annual demand (D) = 7200 books
Order quantity (Q) = 1800 books
Average inventory = Q/2 = 1800/2 = 900 books
Number of orders per year = D/Q = 7200/1800 = 4 times
So it carries an average inventory of 900 books and orders 4 times a year.
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