Title
Operations Management - Inventory Management : EOQ with Quantity Discounts - ExampleCreator
Bonnie Simmons and Memorial University. Centre for Innovation in Teaching and Learning (CITL)Description
Quantity discounts are price reductions for large orders, offered to customers to encourage them to buy in large quantities. As with the basic EOQ, EOQ with quantity discounts answers how much to order & when to order.
This video demonstrates EOQ with Quantity Discounts. In this example a small mail-order company uses 18,000 boxes a year. Holding cost rate is 20 percent of unit cost per year and ordering cost is $32 per order. The following quantity discounts are available. Determine:
a. The optimal order quantity
b. The number of orders per year
Learning Design
Calculate the EOQ with quantity discounts for the given example.Date Created
2017Format
Video/mp4Duration
12:17 minutes/seconds