#1. (12 points) Mercer Sporting Goods (MSG) expects to order 54,000 baseball bats for inventory during the coming year, and it will use this inventory at a constant rate. Fixed ordering costs are $450 per order, the purchase price per bat is $18; and the firm's inventory carrying costs is equal to 40 percent of the purchase price. (Assume a 365-day year.) (a) What is the economic ordering quantity for chips? (2 points) (6) If MSG holds a safety stock equal to a 30-day supply of bats, what is its average inventory level? (2 points) (c) Assume that MSG holds a safety stock equal to a 30-day supply of bats. What is the maximum amount of inventory that will have on hand at any time, that is what will be the inventory level right after a delivery is made? (2 points) (d) How many orders should MSG place during the year? (2 points) (e) If the lead time for placing an order is 5 days, and MSG holds a safety stock equal to a 30-day supply of chips, then at what inventory level should an order be placed? (2 points) (f) If MSG holds a safety stock equal to a 30-day supply of chips, what is MSG's minimum cost of ordering and carrying inventory? (2 points) #1. (12 points) Mercer Sporting Goods (MSG) expects to order 54,000 baseball bats for inventory during the coming year, and it will use this inventory at a constant rate. Fixed ordering costs are $450 per order, the purchase price per bat is $18; and the firm's inventory carrying costs is equal to 40 percent of the purchase price. (Assume a 365-day year.) (a) What is the economic ordering quantity for chips? (2 points) (6) If MSG holds a safety stock equal to a 30-day supply of bats, what is its average inventory level? (2 points) (c) Assume that MSG holds a safety stock equal to a 30-day supply of bats. What is the maximum amount of inventory that will have on hand at any time, that is what will be the inventory level right after a delivery is made? (2 points) (d) How many orders should MSG place during the year? (2 points) (e) If the lead time for placing an order is 5 days, and MSG holds a safety stock equal to a 30-day supply of chips, then at what inventory level should an order be placed? (2 points) (f) If MSG holds a safety stock equal to a 30-day supply of chips, what is MSG's minimum cost of ordering and carrying inventory? (2 points)