5.2 Suppose the quantity of smartphones sold in a year (Q) is 600, the annual carrying cost of holding a smartphone in inventory (C) is $30 per smartphone, the variable cost of an order

(CVAR) is $200 per smartphone, and the fixed cost of an order (CFC) is $10 per order.

a. Use the EOQ model to determine the cost-minimizing quantity to order and the number of orders. What is the total cost when this quantity is ordered?

b. Suppose that with each order the manager orders 60 smartphones. What are the number of orders and the total cost when this quantity is ordered?

c. Suppose that with each order the manager orders 10 smartphones. Now what are the number of orders and the total cost?

d. How do the total costs when 60 and 10 smartphones are ordered compare to the total cost when ordering the quantity using the EOQ model?