An agricultural equipment company estimates its annual carrying cost at 15% of the per unit price of $4. The ordering cost per order is $9. The annual demand for a product they sell is 48000 units per year. The company has 360 working days in a year.
a) What is the most economical number of units to order?
b) How many orders should be placed in a year?
c)How many days is the cycle time or time difference between two orders?
d)If the lead time is 3 days, what is the re-order-point?