Question: Inventory management. Fixed-order-quantity model: Annual demand is 11,500 units, the ordering cost is $75 per order, the holding cost is $30 per unit per year,

  1. Inventory management. Fixed-order-quantity model: Annual demand is 11,500 units, the ordering cost is $75 per order, the holding cost is $30 per unit per year, 1 year = 365 days, lead time = 7 days, cost per unit = $200. No safety stock. (7 points)

  1. Calculate the optimal order quantity or EOQ.
  2. Calculate the total annual cost, i.e., the sum of the annual ordering cost and annual holding cost.
  3. Calculate, number of orders per year, order cycle time, and the reorder point (R)

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