Economic Order Quantity

Ottis, Inc., uses 632,025 plastic housing units each year in its production of paper shredders. The cost of placing an order is $30. The cost of holding one unit of inventory for one year is $15. Currently, Ottis places 159 orders of 3,975 plastic housing units per year.

Required:

1. Compute the economic order quantity.

fill in the blank 1 units

2. Compute the ordering, carrying, and total costs for the EOQ.

Ordering cost	______
Carrying cost	______
Total cost	______

3. How much money does using the EOQ policy save the company over the policy of purchasing 3,975 plastic housing units per order? Round your answer to the nearest dollar

______