MGT 3110: Exam 2 Study Guide
If we check the total cost for any order quantity other than 500(=EOQ), we will see that the cost is higher. For instance, supposing 600 units per order, then. Total cost = 8 * 10000 + 2(10000 / 600) + 0.16(600 / 2) Total cost = $80081. Similarly, if we choose 300 for the order quantity then. Total cost = 8 * 10000 + 2(10000 / 300) + 0.16(300 / 2) ................
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