IM.82 A distributor of industrial equipment purchases specialized compressors for use in air conditioners. The regular price is $40, however, the manufacturer of this compressor offers quantity discounts per the following discount schedule:

Option Plan	Quantity	Discount
A	1 - 499	0%
B	500 - 1,299	0.25%
C	1,300+	1.25%

The distributor pays $76 each time it places an order with the manufacturer. Holding costs are negligible (none) but they do earn 13% annual interest on all cash balances (meaning there will be a financial opportunity cost when they put cash into inventory). Annual demand is expected to be 6,750 units.

EOQ 444

Using the adjusted order quantity as determined above (four questions back), and assuming a materials cost for the given discount, what will be the total annual inventory cost? (Display your answer to the nearest whole number.)

When there is a 0.25% discount (Option Plan B, the second row of the schedule listed above), what is the adjusted order quantity? (Display your answer to the nearest whole number.)

Based on your answer to the previous question, and based on the annual demand as stated above, what will be the annual ordering costs? (Display your answer to the nearest whole number.)

Using the adjusted order quantity as determined above (two questions back), what will be the average number of units held in inventory? (Display your answer to the nearest whole number.)