Question: Average demand = 2 6 units per day Average lead time = 5 2 days Item unit cost = $ 7 2 for orders of

Average demand =26 units per day
Average lead time =52 days
Item unit cost = $72 for orders of less than 420 units
Item unit cost = $69 for orders of 420 units or more
Ordering cost = $47
Inventory carrying cost =25%
The business year is 250 days.
How many chairs should the firm order each time? Assume there is no uncertainty at all about the demand or the lead time.
What will the firms average inventory be under each alternative?
What will be the annual ordering and holding costs for each alternative?

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