What is the economic order quantity for the drones

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Reference no: EM13962006

Suppose that your firm manufactures toy flying drones. Monthly demand for the drones is 230,000 units. Setup cost per order is $220, and the annual holding cost percentage is 24%. The drones cost $50 to produce and are sold for $99.

a) If you have one warehouse, what is the economic order quantity for the drones? What is the total of the annual setup and holding costs of this quantity?

Reference no: EM13962006

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