A local supermarket sells a popular brand of shampoo at a fairly steady rate of 380 bottles per month. The cost of each bottle to the supermarket is 45 cents, and the cost of placing an order has been estimated at $8.50. Assume that holding costs are based on a 25 percent annual interest rate. Stock-outs of the shampoo are not allowed.
Determine the optimal time between placements of orders for this product.
Find the total annual cost of set up and holding.