Joe Birra needs to purchase malt for his microbreweryproduction. His supplier charges $37 per delivery (no matter howmuch is delivered) and $1.25 per gallon. Joe’s annual holding costper unit is 35 percent of the price per gallon. Joe uses 250gallons of malt per week. Assume 52 weeks per year.
Round your answer to 3 digits after the decimal point.Do NOT use comma in your numeric answers.
Suppose Joe orders 1000 gallons each time. His average inventoryis _________ gallons.
Suppose Joe orders 1500 gallons each time. He needs to place_______ orders with his supplier each year to meet the demandexactly.
Joe’s annual purchasing cost is $ _________
Joe’s annual inventory holding cost of the malt is $ _____ pergallon.
Joe should order ________ gallons each time to minimize theannual ordering and holding costs. The minimum ordering and holdingcosts can be expressed as _______ % of the annual purchasingcost.
Suppose Joe orders 2500 gallons each time he places an order.The annual ordering and holding costs will be $ _______ pergallon.
If Joe’s supplier only accepts orders that are integer multiplesof 1000 gallons, then Joe should order _________ each time tominimize the annual ordering and holding costs.
Joe’s supplier offers a 3% discount if Joe is willing topurchase 8000 gallons or more. Suppose Joe orders 8000 gallons eachtime to take advantage of the discount. Joe’s annual inventoryholding cost will be $ ________ per gallon, and Joe’s total annualcost (purchasing, ordering, and holding) will be $.________
