8. The Green Mountain Mower Company produces assorted lawn implements. Storage of a stack of housings for 20-inch lawn mowers requires 4 square feet of floor space in the warehouse, but they can be stacked 45 to a stack. The cost of warehouse space including operating expenses is estimated to be $5.40 per square foot per year. The insurance on the materials in the warehouse costs 0.80 percent of the average inventory value, and taxes are 2 percent of the average annual value in inventory. The cost of working capital invested in inventory is 20 percent per year. Each lawn mower housing costs approximately $4.27 to produce. The use rate for the housings is 36,000 per year. The production rate is 5,000 housings per month, and the setup cost is $100 per run. The company maintains a safety stock of 400 units. :

a. Find the economic production quantity for 20-inch mower housings.

b. Find the average inventory level.

c. What are the annual setup and holding costs for this item?