Question: *** EPQ PROBLEM *** 1. A power plant uses coal to generate electricity. Coal is supplied (delivered) at a rate of 9,000 tons per day

*** EPQ PROBLEM *** 1. A power plant uses coal to generate electricity. Coal is supplied (delivered) at a rate of 9,000 tons per day at price of $16.50 per ton and is used at rate of 1400 tons per day. The plant operates 365 days per year and its annual carrying cost is 28% of acquisition cost. Ordering cost is $675 per order.

a) What quantity of coal should they order each time?

b) What is the maximum inventory level during the year?

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