The EOQ formula is given here:

E$0$Q $=$

$2$ x Ordering Cost x Demand$/$ holding cost

and Total Cost $($Tclis expressed as:

To $-$order quant $*$ Ordering Cost $+(2)*$ Order Quantity x Holding Cost $+$ Total Purchase cost A Clinical laboratory uses $250$ gallons of a certain solvent per year at a purchase price of $$2\mathrm{.}50$ per gallon. The cost associated with placing an order is $$8$ and withholding stock $($on an annual basis$)$ is $20$ percent of the purchase cost per unit. Assuming that the basic conditions of the EOQ

model apply, compute:

a$)$ What is the most economic order quantity?

b$)$ What is the total cost?