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How many drums should Yummy order at a time

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Question - The Yummy Bakery buys flour in 500 pound drums; annual demand is 2,500 drums. The cost per drum is $800, the annual holding cost for inventory is 15% of cost and the administrative costs to place an order are $50. How many drums should Yummy order at a time (in order to minimize costs: EOQ)?

Reference no: EM133050475

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