1. Demand for an item is constant at 20 units a week, the reorder cost is sh.125.00 an order and holding cost is sh2.00 a unit a week. if suppliers guarantee delivery within 2 weeks . what is the best ordering policy for the item.
2. what are the weakness of the above policy
3. A company bought the following number of items. in July it had 8 units in stock. what was the value of this stock? which inventory policies did you use and why .

month Jan Feb mar Apr may jun

number bought 6 4 5 8 3 2

unit price 21 19 18 22 24 26

b ABC ltd uses EOQ logic to determine the order quantity for its various components and its planing orders. the annual consumption is 80,000 units, cost to replace one unit is RS. 1200, cost per unit is RS. 50 and carrying cost is 6% of unit cost. fund EOQ ,number of order per year , ordering cost and carrying cost and total cost of inventory.