A C item is often purchased from the same supplier as a B or A item. Suppose that such is the case and, based on an EOQ analysis for the B (or A) item involved, an order is placed for the B (or A) item every 2 months. Assume that demand for the C item is essentially constant with time at a rate of 18 units/year. Assume that the item has a unit value of $3/unit. The additional fixed cost of including the C item in an order of the B (or A) item is $1.20.

The carrying charge is 0.24$/$/year. It is reasonable to restrict attention to ordering the C item in a quantity that will last for 2 months, 4 months, 6 months, and so on (i.e., an integer multiple of the time supply of the other item). Which of these time supplies is preferred? lpo897