Cycle inventory $=\frac{Q^{**}}{2}=\frac{980}{2}=490$

Number of orders per year $=\frac{D}{Q^{**}}=12\mathrm{.}24$

Length of order cycle $($time between orders$)=Q*\frac{*}{D}=\mathrm{.}08($yr$.)$

$\mathrm{.}08**12=()**$

Annual ordering and holding cost $=\frac{D}{Q^{**}}S+(\frac{Q^{**}}{2})hC=$$$97,980$ Ordering and Holding costs should be close to equal. If not, then error in $Q^{**}.$

Average flow time $=\frac{Q^{**}}{2D}=\frac{490}{12,000}=0\mathrm{.}041=0\mathrm{.}49$ month $=14\mathrm{.}7$ days

Per year.

$*12$

$*30$