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A company sells bicycles. It sells 6,000 bicycles a year. It buys the bicycles from the manufacturer at a purchase price of $25 per cycle.
A company sells bicycles. It sells 6,000 bicycles a year. It buys the bicycles from the manufacturer at a purchase price of $25 per cycle. The companys inventory carrying cost is estimated to be 10% of purchase price and the ordering cost is $30 per order. How many orders must be placed in a year to keep the total inventory cost the lowest possible?
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