Determine the EOQ by increasing significantly the
holding cost between ten to twenty times the
amount used by the textbook. Present the formula and results of the
new EOQ. You will keep the original demand (9,600 units) and
ordering costs, S ($75) the same
Determine a second EOQ by decreasing the ordering
costs to one tenth (1/10) or lower and keeping the
original demand and holding costs, H ($16) the same.
Determine a third EOQ by increasing the holding cost to the
level you selected and decreasing the ordering cost at the same
time based on the last scenario. You keep the demand the same
Study the three scenarios and write a paragraph with your
interpretation of results. What is the meaning, based on current
business trends and technology, to have increasing holding costs
and decreasing ordering costs? What is happening to the EOQ?
Submit one file with the three formulas and results and your
concluding thoughts. As a reference, find attached a
similar analysis done for a different EOQ case.
