Question: Question 2) Inventory Management Basic EOQ Webber Tools sells power washers and is open for business 320 days a year. It costs the store $3750

Question 2) Inventory Management Basic EOQ Webber

Question 2) Inventory Management Basic EOQ Webber Tools sells power washers and is open for business 320 days a year. It costs the store $3750 each time it places an order with the manufacturer for the washers. The annual cost of carrying a washer in inventory is $400. The manager uses the Basic EOQ Model and forecasts an annual demand for the washers of 1200 units. a. What is the economic order quantity? b. What is the total minimum annual inventory cost? c. What is the average inventory level? d. How many orders per year will be required? e. How long is the order cycle time? f. Now assume the manager does not use the EOQ model. Instead, the manager has been ordering 125 washers at a time. How much money will be saved in annual inventory costs if the company switches to the EOQ (assume no stockouts)

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