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Nowlin Pipe & Steel has expected sales of 72,000 pipes this year, an ordering cost of $6.00 per order, and carrying costs of $2.40 per pipe.
a. What is the economic ordering quantity?
Economic ordering quantity (EOQ) ______ Pipes
b. How many orders will be placed during the year?
Number of orders =
c. What will the average inventory be?
Average inventory _______ Pipes
d. What is the total cost of ordering and carrying inventory?
Total cost $
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