Demand for a certain product is $12,000$ units$/$yr$.$ Unit cost$=5\mathrm{.}00.$ Holding

cost rate $=15\%/$yr$.$ Changeover $($setup$)$ time between products $=3\mathrm{.}0$ hr$,$ and

downtime cost during changeover $=100/$hr$.$

$($a$)$ Determine economic order quantity. $(4$ marks$)$

$($b$)$ Determine total inventory costs. $(3$ marks$)$

$($c$)$ Determine total inventory cost per year as a proportion of total

production costs. $(3$ marks$)$