As a recent graduate of Gies, you have been hired as an Inventory Analyst by Olivia Rodrigo Sportswear. Your first assignment is to identify the EOQ (i.e., optimal order quantity) for one of their most popular shirts based on the following information Demand = 2,000 per month, Ordering Costs per Order = $75, Purchase Cost per Unit = $25, Annual Holding Rate per Unit of Inventory = 20%.
1. What is the EOQ? (5 points)
2. What is the annual ordering cost? (5 points)
3. What is the annual inventory holding cost? (5 points)