Answer:
545 boxes
Explanation:
Data provided in the question:
Number of boxes consumed per week = 500
Price of bandage per box = $70
Total operating weeks = 52
cost of processing an order, S = $60
cost of holding one box for a year, H = 15% of value of box
= 0.15 × $70
= $10.5
Now,
Annual demand, D = 52 × 500 = 26000 boxes
Economic order quantity = [tex]\sqrt{\frac{2DS}{H}}[/tex]
on substituting the respective values, we get
Economic order quantity = [tex]\sqrt{\frac{2\times26000\times\$60}{\$10.5}}[/tex]
= 545.10 ≈ 545 boxes
