Question: Economic Order Quantity points ) : A small metal framing shop uses welding rods at a uniform rate. The owner orders the rods from a

Economic Order Quantity points):
A small metal framing shop uses welding rods at a uniform rate. The owner orders the rods from
a local supplier when the annual demand is about 1000 pounds. To place an order, he has to
spend about $3.60 for the phone call and other paper and manpower costs. The cost of a welding
rod is $2? pound and holding costs are assessed based on a 25% annual rate.
(a) How much should the owner order each time to minimize his annual cost?

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