A large bakery buys flour in $25kg$ bags. The bakery uses an average of $4,860$ bags a year. Preparing an order, receiving the

shipment, and paying the invoice costs $$10$ per order. Annual holding cost is $$5$ per flour bag. $$ LO$3$

a$.$ Determine the economic order quantity.

b$.$ What is the average number of bags on hand $($i$.$e$.,$ average cycle inventory$)$ if EOQ is used?

c$.$ How many orders per year will there be if EOQ is used?

d$.$ Calculate the total annual cost of ordering and holding flour for EOQ.

e$.$ If ordering cost were to increase by $50$ percent per order, by what percentage would the EOQ change?