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Industry 4.0 · End Term · 13 Apr 2025 · January 2025 term · Set 4

Question 17: Rahul owns a tea distribution business in Assam. He sour…

Question 17

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Rahul owns a tea distribution business in Assam. He sources premium tea leaves from local tea gardens and supplies them to various retailers. To manage his inventory efficiently, he wants to determine the optimal order quantity for his stock. • The annual demand for tea leaves is 24,000 kg. • The cost of placing an order (ordering cost) is ₹500 per order. • The carrying cost per kg of tea per year is ₹2.

Rahul wants to minimize his total inventory cost by ordering the optimal quantity each time. Answer the given three subquestions

Calculate the Economic Order Quantity (EOQ) for Rahul's business.

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Question 17 of 32 in the IIT Madras BS Industry 4.0 (Industry 4.0) End Term paper sat on 13 Apr 2025, in the January 2025 term (IIT M IMPROVEMENT FN EXAM QIM2 13 Apr). It carries 2 marks.

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