A. Leyla Tas has determined that the annual…

A. Leyla Tas has determined that the annual demand for #6 screws is 100000 screws. Leyla, estimates that it costs 10 MU every time when an order is placed. This cost includes wages, the cost of the forms used in placing the order and so on. Furthermore, she estimates that the cost of carrying are screw in inventory for a year is one-half of 0.01 MU. Assume that the demand is constant throughout the year. a. How many #6 screws should Leyla order at a time to minimize total inventory cost? b. How many orders per year would be placed? What would the annual ordering cost be? c. What would the average inventory be? What would the annual holding cost be?

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