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Item x is a standard item stocked in a company's inventory of component parts. Each year the firm, on a random basis, uses about 1
Item is a standard item stocked in a company's inventory of component parts. Each year the firm, on a random basis, uses about
of item which costs $ each. Storage costs, which include insurance and cost of capital, amount to $ per unit of average
inventory. Every time an order is placed for more of item it costs $
a Whenever item is ordered, what should the order size be
Note: Round your answer to the nearest whole number.
Order size
b What is the annual cost for ordering item
Note: Round your order quantity to the nearest whole number and your final answer to decimal places.
Ordering cost
c What is the annual cost for storing item
Note: Round your order quantity to the nearest whole number and your final answer to decimal places.
Holding cost
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