Question

A manufacturer replenishes their packaging materials according to the economic order quantity model. They use 25,000 cases of packaging materials per year and order 500 cases at a time. Their cost to carry a case in inventory for a year is $12. How much does it cost them to place an order with their supplier?

Answer 1

$300,000 in total , 6000 per order

Answer 2

$300,000 in total, $6000 per order

Step-by-step explanation:

25,000/500 = 50

50*12=600

500*12=6000

50*6000=300000