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A distributor of electric motors experiences an annual demand of 10,000 motors which cost $30 per motor. She orders the motors in a batch ordering process where the ordering cost per order is $50. The annual holding cost is 10% of the cost of an electric motor.
-What is the EOQ for this electric motor?
-What is the total annual cost if the EOQ quantity is ordered?
-What is the average inventory of electric motors that the distributor will have?
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