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A wholesale distributor stocks and sells low flow toilets to contractors for use in commercial office buildings. The estimated annual demand for the toilets is 5,475 units. The estimated average demand per day is 15 units. The purchase cost from the toilet manufacturer is $125.00 per unit. The lead time for a new order is 3 days. The ordering cost is $100.00 per order. The average holding cost per unit per year is $2.50. The distributor has traditionally ordered 250 units each time they placed an order.
What is the average number of units in inventory based upon ordering 250 units each time an order is placed?
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