Answer :
Answer:
optimal order is 2000 gallons
Explanation:
Given data
annual demand D = 10,000 gallons
annual carrying cost H = $0.75 per gallon
ordering cost S = $150 per order
to find out
What is the optimal order size
solution
we will apply here optimal order size is
optimal order = √(2DS/H)
put all these value here
optimal order = √(2DS/H)
optimal order = √(2(10000)150/0.75)
optimal order = √(3000000/0.75)
optimal order = √(4000000)
optimal order is 2000 gallons