Morgan Company's annual demand for Model X253 is 10,000 units. Morgan 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.

Relevant CarryingRelevant Ordering

Cost per Unit per YearCost per Purchase Order

$10 ........................................... $300

10 ............................................200

15 ............................................300

15 ............................................200

20 ............................................300

20 ............................................200

Required

1. Determine EOQ for Morgan 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?