Answer to Question #86119 in Financial Math for Anand
bulk purchase of the same from the nearby city. Every time a purchase is made, it
incurs a cost of ` 50 towards transportation. The daily demand of packets is about
250. Holding cost is ` 0.10 for a packet a day to preserve it in a refrigerator.
Determine the optimum quantity of a bulk purchase and the cycle time.
Calculate the economic order quantity (EOQ), also known as Wilson Formula:
Q - optimal order size,pcs
50 - the cost of a single order, r
250 - the need for inventory items for a certain period of time (year), units
(0.1*250) - the cost of maintaining a unit of inventory, r/pcs