Purchase quantity
Assume your optimal stock amount for cans of tomato paste is 300
units.
If you purchase 300 cans (3-month supply), you pay € 343.50
If you purchase 600 cans (6-month supply), you pay € 650.00
Storage charges are 10% of inventory value per year.
The cost of preparing one P.O. is € 30
a/ should you purchase 300 or 600 cans? Why?
b/ even if it is cheaper to buy 600 cans, should you reject such
a large order?
Purchase quantity Assume your optimal stock amount for cans of tomato paste is 300 units. If you purchase 300 cans (3-mo
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answerhappygod
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Purchase quantity Assume your optimal stock amount for cans of tomato paste is 300 units. If you purchase 300 cans (3-mo
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