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1. Michael's Mechanical sells 6,000 jettison machines annually. Each machine costs Michael's $2000 to purchase, inventory...

1. Michael's Mechanical sells 6,000 jettison machines annually. Each machine costs Michael's $2000 to purchase, inventory carrying costs are 30% of the purchase price, and the cost of placing an order with its supplier is $120. (a) What is the EOQ? (b) What is the total inventory cost at the EOQ?

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Expert Solution

No of machines can not be in fraction, so EOQ is rounded to 49 machines. Annual inventory cost is rounded to 2 decimals. Any change, needed let me know. Thank you

jeff jeffy answered 1 year ago
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