Majestic Traders is a dealer in fast moving product, Zee. An order of 11,200 units monthly have been received from a customer. The cost per order is $25 while the carrying cost is 10% of the average stock value. Product Zee sells at $ 30 per unit.

Required

(i)What is the order size that minimizes the total annual holding cost?

(ii)A supplier have offered a discount of 12% if they can place an order of 2000 units. Advice Majestic Traders on whether to accept the offer or not.

(iii) How often should the orders be placed every time there is need?