Economic Order Quantity. Micro-Encapsulator Corp. (MEC) expects to sell 7,200 miniature home encapsulators this year. The cost of placing an order from its supplier is $250. Each unit costs $50 and carrying costs are 20% of the purchase price. (Please show workings).

a. What is the economic order quantity?

b. What are the total costs order costs plus carrying costs of inventory over the course of the year? (Please show workings).