Alyia Company’s annual demand for Model X253 is 10,000 units. Alyia is unsure about the relevant carrying cost per unit per year and the relevant ordering cost per purchase order. This table presents six possible combinations of carrying and ordering costs.
1. Determine EOQ for Alyia for each of the relevant ordering and carrying-cost alternatives.
2. How does your answer to requirement 1 give insight into the impact on EOQ of changes in relevant ordering and carrying costs?