Babble, Inc., buys 375 blank cassette tapes per month for use in producing foreign language courseware. The ordering cost is $10.25. Holding cost is $0.11 per cassette per year. a. How many tapes should Babble order at a time? Babble should order 916 tapes at a time. (Enter your response rounded to the nearest whole number.) b. What is the time between orders? The time between orders ismonths. (Enter your response rounded to one decimal place,)
Expert Answer
As per given data in the question-
Demand (D)- 375 units/month. 375*12=4500
Ordering Cost (S)- $10.25
Holding Cost (H)- $0.11 per unit per year
EOQ=√2DS/H
=√(2*4500*10.25)/0.11
=916
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