In: Finance
For this item, you are asked to calculate the EOQ –
Economic Order Quantity. A good place to start is by watching this
week’s video.
When determining the numbers for the variables needed to perform
the calculation, be realistic. Research what the actual numbers
could be and provide an explanation/rationale for choosing the
numbers.
Perform the calculation and explain what the result means to your
business.
I have perfromed the calculation for the business I am in, at my end. Please use this solution as a framework to come up with your answer.
While choosing the costs to be included, please choose only the relevant and incremental costs.
I will now give you an example. You may use the same figures but please change the context at your end.