Cynthia Baker, manager of a large medical supply house that operates 50 weeks per year and 5 days per week, has decided to implement a fixed-period inventory system for all class A items. One such item has the following characteristics:
$\begin{array} { l }
\text { Demand } = 10,000 \text { units } / \text { year } \
\text { Order cost } = \$ 50 / \text { order } \
\text { Holding cost } = \$ 5 / \text { unit } / \text { year }
\end{array}$
If Cynthia wishes to minimize the total cost (thereby approximating the economic order quantity (EOQ)), what should be the value of T, the number of workdays between orders (i.e., review period)?

Question

Cynthia Baker, manager of a large medical supply house that operates 50 weeks per year and 5 days per week, has decided to implement a fixed-period inventory system for all class A items. One such item has the following characteristics: 
$\begin{array} { l } 
\text { Demand } = 10,000 \text { units } / \text { year } \
\text { Order cost } = \$ 50 / \text { order } \
\text { Holding cost } = \$ 5 / \text { unit } / \text { year }
\end{array}$
If Cynthia wishes to minimize the total cost (thereby approximating the economic order quantity (EOQ)), what should be the value of T, the number of workdays between orders (i.e., review period)?

Quizplus · Accepted Answer

The Answer of Cynthia Baker, manager of a large medical supply house that operates 50 weeks per year and 5 days per week, has decided to implement a fixed-period inventory system for all class A items. One such item has the following characteristics: 
$\begin{array} { l } 
\text { Demand } = 10,000 \text { units } / \text { year } \
\text { Order cost } = \$ 50 / \text { order } \
\text { Holding cost } = \$ 5 / \text { unit } / \text { year }
\end{array}$
If Cynthia wishes to minimize the total cost (thereby approximating the economic order quantity (EOQ)), what should be the value of T, the number of workdays between orders (i.e., review period)?

Cynthia Baker, Manager of a Large Medical Supply House That