Question: Problem 4: Inventory models (10 points) ABC Beverage Company has soft drink product that has a constant demand rate of 36,000 cases. A case

Problem 4: Inventory models (10 points) ABC Beverage Company has soft drink

Problem 4: Inventory models (10 points) ABC Beverage Company has soft drink product that has a constant demand rate of 36,000 cases. A case of soft drink costs ABC $4. Ordering costs are $20 per order and holding costs are 20% of the value of inventory. ABC has 250 days per year and the lead time is 5 days. Identify the following aspects of the inventory policy for ABC. a. b. Currently ABC is using an order size of 6,000 cases. As a management consultant how can you help them? What would be the new Reorder point? Cycle time? Total annual cost?

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