Lokerup Alarms expects to sell 100.000 door locks this vear. Estimated costs per unit are $1.00 for warehouse space, $2.50 for material handling expenses, $1.25 for interest costs and $3.00 for other carrying costs. Ordering costs are estimated at $38.75 per order.

1. What is the economic ordering quantity?
2. How many orders will be placed during the year?
3. What will the average inventory be?
4. What is the total cost of ordering and carrying inventory?