Assume a safety stock level of 40 and an order quantity of 8…
Assume a safety stock level of 40 and an order quantity of 800, along with the cost, annual demand, average demand, and average lead time information listed previously (which is repeated below): Annual demand = 5000 Holding cost = $4 / unit / year Working days per year = 200 days Order cost = $50 Average daily demand = 25 units Average lead time = 6 days How much is the extra recurring cost annually to keep you from running out of stock during half your lead times?
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