#44 Question (1): Answer the following questions: (10 marks)

1. Based on what you have learned about the two topics Forecasting & Demand Planning and Inventory Management. Explain at length how inventory decisions related to forecasting in the manufacturing process? (4 marks)

2. Greens, a local merchandise uses 1560 bags of plant food annually. Greens works 52 weeks per year. It costs $ 10 to set up an order for plant food. The annual holding cost rate is $5 per bag. Lead time is one week.

• Calculate the economic order quantity. (2 marks)
• Calculate the total annual costs. (2 marks)
• The re-order point (2 marks)