Surge Electric uses 5; 600 toggle switches a year. It costs $140 to prepare an order and receive it, and annual carrying cost is $0:2 per unit.

1. [3 marks] Determine the EOQ.

2. [4 marks] Under EOQ, what are the average number of orders per year and the length

   of each order cycle (in weeks)? Assume one year has 52 weeks.

3. [9 marks] Switches are priced as in the table below. Suppose the optimal order quantity equals EOQ, what is the maximum unit price c1 for the Orst price range (when the number of switches is between 1 and 3,999)?

Unit Price Number of Switches 1 to 3,999 4,000 to 7.999 8,000 or more Ci C2 = $1.980 C3 $1.960