Table 4.1 was developed based on management specifying permitted values of the order quantity expressed as a time supply. Suppose instead that order quantities (in units) were specified.

a. Develop an indifference condition between two adjacent permitted values, namely Q1 and Q2.

b. For A = $10 and r = 0.25 $/$/year, develop a table, similar to Table 4.1 (although the variable involving D and v need not necessarily be Dv), for Q values of 1, 10, 50, 100, 200, 500, and 1,000 units.

c. For an item with D = 500 units/year and v = 0.10 $/unit, what is the exact EOQ? What Q does the table suggest using? What is the cost penalty associated with the use of this approximate Q value?