Question: Economic Ordering Quantity - Please show all work Exercise 4: Economic Ordering Quantity (5 points) The annual demand for a particular drug is 1800 tablets.

Economic Ordering Quantity - Please show all work

Exercise 4: Economic Ordering Quantity (5 points) The annual demand for a particular drug is 1800 tablets. The purchase price of a tablet is $20. The holding cost per unit per year is 25% of the item's price, and the cost of placing an order is $30. The pharmacist orders the drug in quantities of 200. Demand is known and constant. a. Determine the economic ordering quantity. b. Determine the total annual cost (the sum of the total annual ordering and holding costs) for the quantity determined in part a. c. Determine the total annual cost associated with the quantity ordered by the pharmacist. d. Which total cost is higher (part b or part c) and why

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