Finance - A power plant uses coal to generate electricity
Question # 00059077
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Updated on: 04/04/2015 02:57 AM Due on: 04/09/2015
A power plant uses coal to generate electricity. Coal is supplied at a rate of 9,000 tons per day at price of $16.50 per ton and is used at rate of 1400 tons per day. The plant operates 365 days per year and its annual carrying cost is 28% of acquisition cost. Ordering cost is $675 per order.
1. What quantity of coal should they order each time?
2. What is maximum inventory level during the year?
1. What quantity of coal should they order each time?
2. What is maximum inventory level during the year?
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Solution: Finance - A power plant uses coal to generate electricity