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Week5 Saved Help Save & Exit Sub Item X is a standard item stocked in a companys inventory of component parts. Each year the
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a. The optimum order size (EOQ)= Sqrt(2*annual demand*Order Cost per order/Annual holding cost per year)

=Sqrt(2*2600*26/7)=138.97=139 units.

b. Annual ordering cost = Annual demand / EOQ*ordering cost per order = 2600/139*26=$486.33

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