Montague Manufacturing manufactures a product for which the annual demand is 10,000 units. Production averages 100 units per day, while demand is 40 units per day. Holding costs are $1.00 per unit per year and setup cost is $200. Assuming that Montegut Manufacturing wishes to minimize costs, the optimum policy produces an POQ/lot size equal to

5. 78 = 6 orders or setups/year

3.87 = 4 orders or setups per year

Exactly one order or setup per year

6.87 = 7 orders or setups per year

All of the above