Consider the calculation of an EOQ at a hospital. The item to be ordered is a...

Consider the calculation of an EOQ at a hospital. The item to be ordered is a specialized syringe. The demand for these syringes, which cost the hospital $14.50 apiece, is forecasted to be 1475 units per month (with a CV of 8%). The annual holding cost rate used at the hospital is 25% and the ordering cost is estimated to be $80. The lead time from order to receipt is 10 days. The desired service level is 99%. a. Calculate the optimal order quantity and the reorder point. b. Re-calculate Part a if the ordering cost is reduced by 50% to $40.

Expert Solution

orchestra answered 2 years ago

Consider a basic economic order quantity (EOQ) model with the following characteristics: Item cost: $15 Item...

Consider a basic economic order quantity (EOQ) model with the following characteristics: Item cost: $15 Item selling price: $20 Monthly demand: 500 units (constant) Annual holding cost: $1.35 per unit Cost per order: $18 Order lead time: 5 working days Firm's work year: 300 days (50 weeks @ 6 days per week) Safety stock: 15% of monthly demand For this problem, determine the values of: Q* the optimal order quantity and reorder point. Select one: a. 400 and 100 b....

For this item, you are asked to calculate the EOQ – Economic Order Quantity. A good...

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Comprehensive with safety stock at EOQ The following items relate to stock item NextZen:

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1. For the following list, decide how each item affects the calculation of GDP for Macro...

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Typically, a hospital patient receives medications that have been ordered by a particular doctor. Because the...

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