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Joe's Camera shop has a favorite model that has annual sales of 145. The cost to place an order to replenish inventory is $25 per order, and annual inventory costs are $20. Assume the store is open 350 days per year.
a. What is the optimal order size?
b. What is the optimal number of orders per year?
c. What is the optimal number of days between orders?
d. What is the annual inventory cost?
e. If the lead time were 20 days, what would be the reorder point?
f. For what value of ordering cost would 30 units of order size be optimal?
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Calculate the market value of this investment if the market rate of return on comparable investments is 8%
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