$1\mathrm{.}2$

REQUIRED

Use the information provided below $to$ calculate the economic order quantity.

INFORMATION

$(4$ marks$)$

The average monthly usage $ofan$ item that costs $R2$ each and sells for $R4\mathrm{.}50$ each $is600$ units. The

holding cost $is10\%of$ the cost $of$ the item. The cost $to$ place $an$ order $isR20.$