A local factory was having difficulties with managing its inventory, so they asked you as a consultant to help. The situation is following: A toy manufacturer uses 48,000 rubber wheels per year for its popular dump truck series. The firm makes its own wheels which it can produce at a rate of 800 per day. The toy trucks are assembled uniformly over the entire year. Holding cost is $1 per wheel a year. Setup cost for a production fur of wheels is $45. The firm operates 240 days per year. - Determine the average inventory level, the optimal run size and the minimum total annual cost for carrying and setup. In addition, what is the production duration period and the usage only duration period, The company is considering to outsource the production of rubber wheels. Having that in mind calculate the average inventory level, EOQ and total costs. Ordering cost, in this case is $83. Holding cost stays the same which is $1 per wheel a year. Make conclusion from the conducted calculations and inform the company management if outsourcing is good business idea.