Question

Fancy-Bike Manufacturing needs 100,000 units of bicycle tires for its production of beach bikes per year. The carrying costs of these tires are $10 per unit per year and the fixed ordering cost is $400. What is the optimal number of units Fancy-Bike should order each time in order to minimize total inventory cost? At this optimal quantity, how often should Fancy-Bike order its bicycle tires? Assume a 365-day year.

Answer 1

Limanodo to minimize total inventory Coct 35.34 26 Lisofor Evexy 10 DAS 36 5 dlort

Fancy bike should order 2829 units per order to minimize their Total inventory cost.

Fancy bike should order it's bicycle tires for every 10 days of the year of 2829 units per order.