Ottis, Inc., uses 636,740 plastic housing units each year in its production of paper shredders. The cost of placing an order is $28. The cost of holding one unit of inventory for one year is $13. Currently, Ottis places 158 orders of 4,030 plastic housing units per year.

1. Compute the annual ordering cost.

$

2. Compute the annual carrying cost.

$

3. Compute the cost of Ottiss current inventory policy.

$