Question

Please help me find Q1 Q2 Q3 and total cost. Thank you.

eBook The Economic Order Quantity (EOQ) model is a classical model used for controlling inventory and satisfying demand. Costs included in the model are holding cost per unit, ordering cost and the cost of goods ordered. The assumptions for that model are that only a single item is considered, that the entire quantity ordered arrives at one time, that the demand for the item is constant over time, and that no shortages are allowed. Suppose we relax the first assumption and allow for multiple items that are independent except for a restriction on the amount of space available to store the products. The following model describes this situation: Let Dj - annual demand for itemj Gj = unit cost of itemſ Sj = cost per order placed for item i 1 - inventory carrying charge as a percentage of the cost per unit W = the maximum amount of space available for all goods wj = space required for itemj The decision variables are Qj, the amount of item j to order. The model is: Minimize Ex.C,D,+Sp+10,91 0,20 ;-1,2. -N In the objective function, the first term is the annual cost of goods, the second is the annual ordering cost (Dj/Qj is the number of orders), and the last term is the annual inventory holding cost (Qj/2 is the average amount of inventory). Set up a spreadsheet model for the following data: Item 1 Item 2 Item 3 Annual Demand 2,500 2,500 1,000 Item Cost ($) 90 45 60 Order Cost ($) 170 130 115 Space Required 50 25 40 (sq. feet) W = $24,000 1 -0.2 Solve the problem using Excel Solver. Hint: You will need to start with decision variable values that are greater than 0 for Solver to find a solution. If required, round your answers to two decimal places. Optimal Solution: Q1 = 2224 Q2 = 1491.0 03 - 1284 If required, round your answer to the nearest dollar. Do not round intermediate calculations. Total cost = $ 5000 Hide Feedback Incorrect

Answer 1

AB 3 Q1 4 Q2 5 Q3 6 Cost Quantit function to minimise first constraint 199 228926.6036 9952.160567 246.2 114928.0034 6153.887464 197.3 152640.9043 7893.95197 496495.5113 24000

Q1=199,Q2=246.2,Q3=197.3, Total Cost=496495.51