Question: The Demand for machine parts is steady and predictable at 1 1 6 4 units per year. The unit cost of the parts is $

The Demand for machine parts is steady and predictable at 1164 units per year. The unit cost of the parts is $554.The supplier charges a fixed cost of $490 per order to cover the costs of shutting down normal production to produce the requested parts. Our company estimates an opportunity cost for money at 8% per year. It also estimates that the floor space required to store a metal part costs $8 per year. If the replenishment lead time is 3 weeks, what is the reorder point, if the economic order quantity is 109.

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