Minimize inventory holding and ordering costs

Assignment Help Operation Management
Reference no: EM131149048

Sarah needs to purchase organic Palm oil to make her soaps. She needs 1,000 kgs of Palm oil per day on average. The supplier charges a $60 delivery fee per order (which is independent of the order size) and $4.75 per kg. Sarah's annual holding cost is 25%. Assume 52 weeks per year and 5 days per week. If Sarah wants to minimize inventory holding and ordering costs, how much Palm oil should she purchase with each order (in kgs)?

Reference no: EM131149048

Questions Cloud

What are you getting in terms of interest rate : What are you getting in terms of interest rate if you are willing to pay $15,000 today for an annual stream of payments of $2,000 for the next twenty years? Next forty years? Next one hundred years? Forever?
What is the optimal total annual inventory cost : Brady Jones is a manager at a local store that sells computers. He needs to decide how many computers to order based on the quantity discount schedule below. Annual demand is 3,000 computers, annual inventory carrying cost as a percent of unit cost i..
Determine the different types of performance measurements : Analyze how operation management activities affect the customer experience. Select two (2) operation management challenges and provide the solutions for confronting them.
List the names and last names of professors with phd degree : List the names and last names of professors with PhD Degree. List the names and last names of professors with PhD Degree in Electrical Engineering. List the titles and course units of the courses that are taught by professors with PhD Degree.
Minimize inventory holding and ordering costs : Sarah needs to purchase organic Palm oil to make her soaps. She needs 1,000 kgs of Palm oil per day on average. The supplier charges a $60 delivery fee per order (which is independent of the order size) and $4.75 per kg. Sarah's annual holding cost i..
What is the future value of this cash flow at 6 9 percent : Given the following cash inflow at the end of each year, what is the future value of this cash flow at 6%, 9%, and 15% interest rates at the end of the seventh year?
Globalization embarking on market diversification strategy : What benefits have CEMEX and the other global competitors in cement derived from globalization? More broadly, how can cross-border activities add value in an industry as apparently localized as cement? CEMEX and the other global competitors certainly..
Determine the amount you will pay back : Determine the amount you will pay back and the annualized cost of borrowing for LIBORs of 6 percent and 12 percent.
How has fedex managed to maintain technical superiority : How has Fedex managed to maintain technical superiority (i.e., reliability, service, package tracking, etc.) in its industry? Can Fedex continue to do so in the future? Why or why not?

Reviews

Write a Review

 

Operation Management Questions & Answers

  The rise of various digital communication methods

The rise of various digital communication methods in the past decade has greatly changed the field of public relations. What new and emerging technologies do you think will continue to change the PR field? How do you anticipate the PR field changing ..

  Give an example of a good and a service

Give an example of a good and a service that exhibit these seasonal demand patterns Annual Monthly Weekly d. Daily

  Discuss the key elements of identifying white-collar crimes

Discuss the key elements of identifying white-collar crimes. Next, determine at least two (2) federal criminal statutes that government agencies commonly use to convict white-collar criminals, and specify the main reasons why government agencies comm..

  Discuss the difference between attributes and variables data

Discuss the differences between attributes and variables data. List the six basic steps involved in building the house of quality.

  Two types of grass seed into a blend

The Sanders Garden Shop mixes two types of grass seed into a blend. Each type of grass has been rated (per pound) according to its shade tolerance, ability to stand up to traffic, and drought resistance, as shown in the table. Type A seed costs $1 an..

  State what is meant by morality

State what is meant by morality. Explain with examples how an employee's morality relates to making ethical decisions in the workplace.

  What kind of constraints would exist on the number of

a trading company in the middle ages transported tea spices and other oriental products via the overland trade route

  What you have researched and studied throughout modules

Using what you have researched and studied throughout Modules 1 - 7, write a report addressing a quantitative analysis (QA) project

  Estimated average inventory for the third quarter

Based on recent data from the third quarter of 2015, McDonald's Corp. had a quarterly COGS of 4.024 B$ (FYI, this was higher than the third quarter of 2014). It's estimated Average Inventory for the third quarter ending September 2015 was 101 M$ = 0...

  About the cooperative strategy

From an ethical perspective, determine how much information a firm is obliged to tell a potential strategic alliance partner about what it expects to learn from the cooperative arrangement. Explain your rationale. From the e-Activity, determine which..

  Which of the given if true would most support the

cooper mills is a company that accomplished one of the greatest success stories of our time. the company which began in

  What is the probability of a favorable seismic survey

What is the probability of a favorable seismic survey?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd