An electronics store wants to use a scientific system to manage the inventory of a popular brand of graphic calculator The store has gathered the following information about the calculator Average demand 90 units per week Ordering cost $40 per order Item Cost $80 per calculator Inventory holding cost 20 of the cost of the item per unit per year Number of weeks per year 52 weeks Determine the economic order quantity Note Show all steps and calculations The company currently uses an order quantity of 100 Determine the total annual cost (ordering holding cost) being incurred by the company with this order quantity Note Show all steps and calculations How much would the company save annually by switching to the economic order quantity determined in part (a) Note Show all steps and calculations

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Question: An electronics store wants to use a scientific system to manage the inventory of a popular brand of graphic calculator. The store has gathered the

An electronics store wants to use a scientific system to manage the inventory of a popular brand of graphic calculator. The store has gathered the following information about the calculator:

Average demand = 90 units per week

Ordering cost = $40 per order

Item Cost = $80 per calculator

Inventory holding cost = 20% of the cost of the item per unit per year

Number of weeks per year = 52 weeks

Determine the economic order quantity? Note: Show all steps and calculations.
The company currently uses an order quantity of 100. Determine the total annual cost (ordering + holding cost) being incurred by the company with this order quantity. Note: Show all steps and calculations.
How much would the company save annually by switching to the economic order quantity determined in part (a)? Note: Show all steps and calculations.

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