Andrew is running a pharmacy in Nigeria (where Naira is the local currency). His recent experience in the MicroMasters course motivated him to rethink how to reorder pharmaceuticals to replenish inventory. He recalls from Module 4, Unit 1, Video 5, that he should consider the purchase cost, the order cost, and the holding cost. In the past, Joshua rigorously tracked these cost items. For Ibuprofen he knows that:

unit cost:= 382 Naira/pack

demand:= 760 packs/year

ordering cost:= 1900 Naira/order

holding cost:= 60 Naira/pack*year

How many packs of Ibuprofen should Joshua order to minimize the total cost? 219

Part 2: Consolidating orders

Andrew runs a second pharmacy on the other side of town. He has been ordering for each location individually from a wholesaler. He realizes that he can save some money by consolidating the two orders into one single order. The costs per pack for both pharmacies are exactly the same (use,andvalues from Part 1). The annual demand for Ibuprofen in the second pharmacy is 1130 packs.

What is the consolidated optimal order quantity (in packs of Ibuprofen)? 346

Round your answer to the nearest integer.

Part 3: Savings from consolidation

If Roy places one consolidated order (as in Part 2) instead of placing two separate orders, how much money will he save?

Round your answer to one decimal place (e.g. if the result is 1.534 put in as an answer 1.5)