Diagnostic Supplies has expected sales of 175,000 units per year, a carrying cost of $5 per unit, and an ordering cost of $7 per order.
(a) What is the economic order quantity?
Economic order quantity units
(b-1) What is average inventory?
Average inventory units
(b-2) What is the total carrying cost? (Omit the "$" sign in your response.)
Total carrying cost $
Assume an additional 70 units of inventory will be required as safety stock.
(c-1) What will the new average inventory be?
Average inventory units
(c-2) What will the new total carrying cost be? (Omit the "$" sign in your response.)
Total carrying cost $