Demand for an item is 1,000 units per year. Each order placedcosts $10, the annual cost to carry items in inventory is $2 each.Suppose the lead time is 6 days. Assume sales occur over 360 daysof the year.
In what quantities should the item be ordered based on the EOQmodel? (2 points)
What is the reordering point? (2 points)
Explain the inventory management policy. (1point)
