16) Alexis Company uses 900 units of a product per year on a continuous basis. The product has a fixed cost of $55 per order, and its carrying cost is $2 per unit per year. It takes 5 days to receive a shipment after an order is placed. And the firm wishes to hold 10 days usage in inventory as a safety stock

a.Calculate the EOQ

b.Determine the average level of inventory. (Note: Use a 365-day year to calculate daily usage)

c.Determine the reorder point

d.Indicate which of the following variable change if the firm does not hold the safety stock: (1) order cost, (2) carrying cost, (3) total inventory cost (4) reorder point (5) economic order quantity. Explain.