Problem No 03

Shah bookstore is attempting to determine the optimal order quantity for a popular book on Financial Management. The store sells 5,000 copies of this book a year. The store gures that it costs $1.80 per year to carry a book in inventory and $75 to prepare an order for new books. a. Determine the total inventory costs associated with ordering 1, 5, 25, 50, and 100 times a year. b. Determine the economic order quantity.