6 Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year.

a. State the order quantity and reorder point.

b. Determine the annual holding and order costs.

c. If a price break of $50 per order was offered for purchase quantities of over 2,000, would you take advantage of it? How much would you save annually?

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$250,00 Standard deviation of weekly demand 25 per week 33% of item cost Lead time 1 week Service probability 95% Item cost Order cost Annual holding cost (%) Annual demand Average demand $10,00 25.750 515 per week