Question: Consider an economic order quantity case where average daily demand for a specific component is 500 units with standard deviation of 25 units. The company

Consider an economic order quantity case where average daily demand for a specific component is 500 units with standard deviation of 25 units. The company works 250 days a year. Assume lead time of 2 weeks for the component. Furthermore, assume ordering cost is $20 per order and holding costs is $1.5. Calculate the following:

Annual ordering costs

Total annual inventory costs

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