Aparticularitemhasademandof9,000unitsperyear.Thecostofoneprocurement

isKshs.100andtheholdingcostperunitisKshs.2.40peryear.Thereplacementis

instantaneousandnoshortagesareallowed.Determine:

i.Theeconomiclotsize

ii.Thenumberofordersperyear

iii.Thetimebetweenorders

iv.ThetotalcostperyearifthecostofoneunitisKshs.1.00

b)Astockisthastosupply400unitsofaproducteveryMondaytohiscustomers.He

getstheproductatKshs.50perunitfromthemanufacturer.Thecostofordering

andtransportationfromthemanufacturerisKshs.75perorder.Thecostofcarrying

inventoryis7.5%peryearofthecostoftheproduct.Find:

i.Theeconomiclotsize

ii.Thetotaloptimalcost(Includingthecapitalcost),

iii.ThetotalweeklyprofitiftheitemissoldforKshs.55perunit