A firm has monthly demand of 4000 units of a product. The product requires a component costing ₹ 20…
Annual demand is \(D\) \(=4{,}000\times12\) \(=48{,}000\) components, and annual holding cost per component is \(H=20\times0.10=₹\,2\). Thus \(EOQ\) \(=\sqrt{2DS/H}\)…
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A firm has monthly demand of 4000 units of a product. The product requires a component costing ₹ 20 each unit. Every product (Finished goods) requires one unit of component only. The ordering cost is ₹ 120 per order and the holding cost is 10 percent per annum. Find Economic Order Quantity (EOQ).
Answer and explanation
Correct answer C
Annual demand is components, and annual holding cost per component is . Thus units.
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Rajasthan SET (RSET)